The facts on HECS-HELP

Get the facts on HECS-HELP
    Update 12/5/15: Changes to HELP repayments for overseas debtors (those living overseas for more than 6 months with a HELP debt) whereby they need to start repaying their debt based on worldwide income. Applicable from 1 January 2016.
  • How much is HECS-HELP per year?
This all depends on your HELP repayment income. Your HELP repayment income is calculated using the following amounts from your tax return:
  • taxable income
  • reportable fringe benefits (as reported on your payment summary)
  • total net investment loss (which includes net rental losses)
  • reportable super contributions
  • any exempt foreign employment income amounts
If repaying via the tax system, compulsory repayments are made at the same time as your Tax Return. Repayments commence from $49,096 during the 2012/3 financial year. Thus, if your HELP repayment income is over that amount, you will have to start (or continue) to pay HECS-HELP. For rates, please see this link >
  • Tip
Ensure your employer is aware you have a HECS-HELP liability; otherwise it might become a nasty surprise at tax time.
  • When is HECS-HELP indexed?
On 1 June each year indexation is applied to the part of HELP debt that has remained unpaid for more than 11 months.
  • Tax and HECS-HELP
To claim a deduction for self-education expenses, you must have met one of the following conditions when you incurred the expense (crucial!):
  • the course maintained or improved a skill or specific knowledge required for your then current work activities
  • you could show that the course was leading to, or was likely to lead to, increased income from your then current work activities, or
  • other circumstances existed which established a direct connection between the course and your then current work activities.
You cannot claim a deduction for self-education for a course that:
  • relates only in a general way to your current employment or profession, or
  • will enable you to get new employment.
The law has been changed so that, for the 2012 year and later years, you cannot claim a deduction for study expenses you incur that relate only to your receipt of Austudy, ABSTUDY and Youth Allowance. If, when you incurred your expenses you satisfied the conditions necessary to claim a deduction (as per the above), you can claim the following:
  • your tuition fees payable under FEE-HELP
  • your other expenses such as textbooks, stationery, student union fees, student services and amenities fees, course fees, and the decline in value of your computer (apportioned depending on private use and use for self-education)
  • expenses for your travel in either direction between your home and your place of education OR your workplace and place of education.
  • Wish to make a voluntary repayment?
The Now
  • Commonwealth supported students who are eligible for HECS-HELP and elect to fully pay, or part pay $500 or more of, their student contribution amount upfront to their higher education provider currently receive a discount of 10 per cent.
  • People who have a HELP debt and make a voluntary repayment of $500 or more towards that debt currently receive a bonus of 5 per cent. The amount of the bonus is an additional credit against the student’s outstanding HELP debt. It is an amount never recovered by the Government.
The Possible Future Subject to the passage of legislation, from 1 January 2014, the Australian Government will remove the upfront HECS-HELP discount of 10 per cent for eligible students that pay their student contributions upfront and the voluntary HELP repayment bonus of five per cent. The removal of the upfront discount will affect students who can afford to pay upfront and choose to do so.   For more information, please don’t hesitate to contact this office.