Medicare Levy Surcharge
Find out if you're paying the surcharge and how much you could save with private health insurance in 2025-26.
Surcharge Calculator
Include taxable salary, reportable employer super, and net fringe benefits.
Arbitrage Visualization
Estimated Annual Surcharge Tax Penalty
Your taxable income places you in the 1.3% Medicare Levy Surcharge tax tier.
Buy Private Hospital Cover & Save $300.00
Basic Australian hospital insurance is estimated at $1,200.00/yr. Because this completely exempts you from the Medicare Levy Surcharge:
MLS Surcharge Tax
$1,500.00
Estimated Premium
-$1,200.00
Cash in Pocket
+$300.00
🚀 Bottom Line: Taking out private hospital cover saves you $300.00 in cash AND grants you full private healthcare coverage for free, instead of paying a pure tax penalty to the ATO!
What is the Medicare Levy Surcharge (MLS)?
The Medicare Levy Surcharge (MLS) is an extra tax paid by Australian taxpayers who earn above a certain income and do not have an appropriate level of private hospital insurance. It is on top of the standard 2% Medicare Levy that most Australians pay.
MLS Income Thresholds (2025-26)
The thresholds for the 2025-26 financial year have been indexed upwards:
| Tier | Single Income | Family Income | Surcharge Rate |
|---|---|---|---|
| Base Tier | $0 - $101,000 | $0 - $202,000 | 0% |
| Tier 1 | $101,001 - $118,000 | $202,001 - $236,000 | 1.0% |
| Tier 2 | $118,001 - $158,000 | $236,001 - $316,000 | 1.25% |
| Tier 3 | $158,001+ | $316,001+ | 1.5% |
*Family thresholds increase by $1,500 for each dependent child after the first.
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