Need help with HELP debts?
Here are some tips on repaying your HELP debt…
If you are one of many people who graduated university with a HELP (Higher Education Loan Program) debt, you might not be sure exactly what the steps are to repay help debt.
It’s important that you know how to repay HELP debt so you can pay it off and move on with your life!
HECs (Higher Education Contribution Scheme) debts are now also known as a HELP debt.
HELP Debt Payments: Some Details and Options
If you have a HELP debt, you must start repaying it when your repayment income is above the minimum threshold set by the ATO. For the 2020-21 financial year the minimum threshold is $46,620.
Your HELP repayment income is the total of the following amounts obtained from your income tax return:
- Taxable Income,
- Any amount your taxable income was reduced by a rental loss,
- Reportable fringe benefits,
- Any exempt foreign employment income amounts, and
- Reportable super contributions.
The 2020-21 HELP repayment thresholds and rates are listed below:
Repayment Income — Repayment Rate
Below $46,620 — No Repayment
$46,620 to $53,826 — 1%
$53,827 to $57,055 — 2%
$57,056 to $60,479 — 2.5%
$60,480 to $64,108 — 3%
$64,109 to $67,954 — 3.5%
$67,955 to $72,031 — 4%
$72,32 to $76,354 — 4.5%
$76,355 to $80,935 — 5%
$80,936 to $85,792 — 5.5%
$85,793 to $90,939 — 6%
$90,940 to $96,396 — 6.5%
$96,397 to $102,179 — 7%
$102,180 to $108,309 — 7.5%
$108,310 to $114,707 — 8%
$114,708 to $121,698 — 8.5%
$121,699 to $128,999 — 9%
$129,000 to $136,739 — 9.5%
$136,740 and above — 10%
The 2019-20 HELP repayment thresholds and rates are listed below:
Repayment Income — Repayment Rate
Below $45,881 — No Repayment
$45,881 to $52,973 — 1%
$52,974 to $56,151 — 2%
$56,152 to $59,521 — 2.5%
$59,522 to $63,092 — 3%
$63,093 to $66,877 — 3.5%
$66,878 to $70,890 — 4%
$70,891 to $75,144 — 4.5%
$75,145 to $79,652 — 5%
$79,653 to $84,432 — 5.5%
$84,433 to $89,498 — 6%
$89,499 to $94,868 — 6.5%
$94,869 to $100,560 — 7%
$100,561 to $106,593 — 7.5%
$106,594 to $112,989 — 8%
$112,990 to $119,769 — 8.5%
$119,770 to $126,955 — 9%
$126,956 to $134,572 — 9.5%
$134,573 and above — 10%
Repay HELP Debt with voluntary HELP repayments
Help your HELP debt to disappear.
A great way to repay HELP debt is through voluntary repayments, when you can afford to wipe out a bit more of your debt. You can make Voluntary HELP repayments it any time of the year.
If you repay HELP debt more quickly, you’ll be ready to start saving (or shopping) a lot sooner. Don’t put it off or it will really hurt your wallet later.
Important Notes
- Making a voluntary repayment does not make you exempt from compulsory repayments unless your accumulated HELP debt is nil or your repayment income is below the minimum compulsory threshold.
- Your debt increases annually in line with the Consumer Price Index on June 1st. This increase is applied to the part of your debt that has remained unpaid for 11 months or more. Therefore, if you make a voluntary payment to reduce your HELP debt before 1st June and it has enough time to be processed, you won’t be charged interest on the amount you have just paid off.
- If you will make a big voluntary payment, or pay off your HELP debt, it is generally better to do that before you lodge your next tax return. For personalised advice you should consult an accountant (eg. if you are an Etax user, you can consult with our accounting team, anytime, with no appointments).
- If you ever find you have a large tax payable in your tax return due to your compulsory HELP repayment, you should check with your employer to ensure they are taxing you correctly each week.
- Even if you move overseas to work temporarily or permanently, the ATO still expects you to make a compulsory HELP repayment if you meet the income thresholds. Please take a look at our detailed articles on overseas HELP debt obligations if you fall into this category.
