HECS/HELP repayment thresholds 2026–27 explained

If you studied at university or did a subsidised vocational course, you probably have a study and training support loan: HECS-HELP, FEE-HELP, VET Student Loan or similar. You don’t choose when to repay it: once your income passes a threshold, the ATO collects a compulsory repayment through your tax return. Here’s how much, and how the system changed.

The marginal system (2025–26 onward)

The big change in recent years is how the repayment is calculated. Under the old system, once your income crossed a threshold, a single percentage applied to your entire income, so earning a dollar more could cost you hundreds in extra repayment. That “cliff” is gone.

Since the 2025–26 year, repayments use a marginal system, just like income tax. The rate applies only to the income above each threshold, and the total is capped at 10% of your repayment income.

For 2026–27 the bands are:

Repayment income	Compulsory repayment
Below $69,528	Nil
$69,528 – $129,717	15c per $1 over $69,528
$129,718 and over	$9,028 + 17c per $1 over $129,717 (capped at 10% of income)

A worked example

Suppose your repayment income is $80,000. You’re $10,472 above the first threshold of $69,528. At 15c in the dollar on that slice, your compulsory repayment is about $1,571 for the year, roughly $60 a fortnight.

Notice that’s only about 2% of your income, not 15%. The 15% rate applies only to the $10,472 above the threshold, not the whole $80,000. As your income rises, the repayment climbs smoothly rather than jumping at each threshold.

What is “repayment income”?

Repayment income is a bit broader than taxable income. It’s your taxable income plus certain add-backs:

• reportable fringe benefits;
• reportable (salary-sacrificed) super contributions;
• net investment and rental losses;
• exempt foreign employment income.

For most employees with a straightforward salary, repayment income is close to taxable income, so that’s a reasonable figure to start with.

Indexation: the part people miss

HELP loans don’t charge interest, but the balance is indexed each year to keep pace with rising prices. Following a 2024 change, indexation is now the lower of the Consumer Price Index (CPI) and the Wage Price Index (WPI), which stops the balance outpacing wages the way it did in high-inflation years.

Indexation is applied to the balance that remains after your compulsory and voluntary repayments are credited. That’s why some people make a voluntary repayment before the indexation date: it reduces the balance that gets indexed. Whether that’s worth doing depends on your other financial priorities; it’s a personal call, not an obligation.

Employer withholding vs the actual repayment

If you tell your employer you have a study loan, they withhold extra tax across the year. But the actual compulsory repayment is worked out when you lodge your return, based on your final repayment income. If too much was withheld you get it back; if too little, you may owe a top-up. The HECS/HELP calculator shows the annual figure and a per-fortnight and per-month equivalent so you can sanity-check what’s coming out of your pay.

Run your own numbers

Enter your income into the HECS/HELP calculator to see your compulsory repayment for 2026–27. To see how it fits into your whole pay packet alongside income tax and super, use the take-home pay calculator and switch on the HELP/HECS toggle.

Thresholds are indexed annually and figures here are the ATO’s published 2026–27 values. This is general information, not tax advice; confirm with the ATO or your registered tax agent.