Insurance tax deductions and rebates this EOFY

Richard Laycock 21 June 2017

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Getting your finances in order? Five ways to get more from your insurance this EOFY.

Don't pay more in tax than you have to. See which of your insurance premiums you can deduct or get a rebate on, so that you can get more back from the taxman this EOFY.

Health insurance premiums

Do you have private health insurance? While health insurance premiums are not tax deductible, you are able to claim a rebate on your premiums. The amount you can claim is dependent on your age and how much you earn. The rebates applicable to private health insurance from 1 April 2017 to 31 March 2018 are:

Base TierTier 1Tier 2Tier 3
Singles≤$90,000$90,001-$105,000$105,001-$140,000≥$140,001
< age 6525.93%17.29%8.64%0%
Age 65-6930.26%21.61%12.97%0%
Age 70+34.58%25.93%17.29%0%
Base TierTier 1Tier 2Tier 3
Families≤$180,000$180,001-$210,000$210,001-$280,000≥$280,001
< age 6525.93%17.29%8.64%0%
Age 65-6930.26%21.61%12.97%0%
Age 70+34.58%25.93%17.29%0%

You can also save on your health insurance by reviewing the various promotions and offers available from private health insurers at this time of year.

Income protection insurance

Unlike your premiums for life insurance, total permanent disability (TPD) insurance or trauma insurance, you may be able to claim a deduction for your income protection premiums. We spoke with H&R Block's director of tax communications Mark Chapman, who said, "Premiums for income protection insurance are 100% tax deductible. However, the payments you receive from the policy are taxable as income."

Premiums/payouts from policyOutside superInside super
Premiums you pay
  • Tax deductible
  • Tax deductible (up to a limit)*
Payouts you receive
  • Taxable as income
  • Not taxable as income (depends on your age)*

*Benefits will be taxed if your premiums are tax deductible. Check with your super fund. Note: This table is only a general guide and doesn't take into account your specific circumstances. It's a good idea to seek professional advice from a qualified tax consultant before applying this information to your personal circumstances.

Travel insurance

Do you take out travel insurance when you travel for work? Can you claim a deduction for your single or annual policy premiums? "Yes, provided it relates solely to work. It would need to be prorated if it also covered any element of private travel,” says Chapman.

Car insurance

Just like how you can claim any car expenses when you use your own vehicle for work, you can also claim a tax deduction for the parts of your car insurance premiums that relate to the work use of your vehicle.

Rental property insurance

If you own an investment property, you may be able to claim a deduction for various premiums related to the property including:

  • Buildings insurance
  • Contents insurance
  • Landlord insurance

Compare your health insurance options this EOFY

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DISCLAIMER: This article contains general advice and does not consider your own personal circumstances. It is not tax advice and the general nature of this material may not be applicable to you. You should obtain professional advice and verify our interpretation before relying on the information contained in our article.

Picture: Shutterstock

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