🏥 Your Income Details
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Total Medicare Obligation
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Medicare Levy (2%)
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MLS (if applicable)
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% of income
📋 Breakdown
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Medicare Levy in Australia: What You Pay and Why
The Medicare Levy is a 2% tax on your taxable income that funds Australia's universal healthcare system. It is paid by most Australian residents as part of their annual tax assessment. On top of this, higher-income earners without private hospital cover pay an additional Medicare Levy Surcharge (MLS) of 1–1.5%.
2025–26 Medicare Levy Thresholds
| Situation | Full Levy From | Reduction Zone | Exempt Below |
|---|---|---|---|
| Single | $26,000+ | $22,801–$26,000 | $22,801 |
| Family | Higher thresholds | Phased reduction | $38,474 combined |
| Seniors/Pensioners | $36,056+ | Phased | $36,056 |
Medicare Levy Surcharge (MLS) — 2025–26
The MLS is an additional levy on higher-income earners without private hospital cover:
| Income Tier | Singles | Families | MLS Rate |
|---|---|---|---|
| Tier 0 | ≤$93,000 | ≤$186,000 | 0% |
| Tier 1 | $93,001–$108,000 | $186,001–$216,000 | 1.0% |
| Tier 2 | $108,001–$144,000 | $216,001–$288,000 | 1.25% |
| Tier 3 | $144,001+ | $288,001+ | 1.5% |
Estimates based on 2025-26 ATO rates. Not tax advice. Consult a registered tax agent.
Frequently Asked Questions
What is the Medicare Levy in Australia in 2025?
The Medicare Levy is 2% of your taxable income, paid by most Australian residents. On a $85,000 income, this is $1,700/year. Low-income earners (below ~$26,000) pay a reduced or zero levy.
Who pays the Medicare Levy Surcharge?
Singles earning over $93,000 and families earning over $186,000 who don't hold private hospital cover pay the MLS of 1–1.5% in addition to the standard 2% Medicare Levy. Taking out basic hospital cover can cost less than the MLS penalty.
Can I get a Medicare Levy exemption?
Yes — low-income earners, some foreign residents, and people meeting certain criteria can be fully or partially exempt. Seniors and pensioners have higher exemption thresholds. Check ATO.gov.au or consult a tax agent.