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

Surcharge Active

Estimated Annual Surcharge Tax Penalty

$1,500.00

Your taxable income places you in the 1.3% Medicare Levy Surcharge tax tier.

✨ Tax Arbitrage Strategy

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:

TierSingle IncomeFamily IncomeSurcharge Rate
Base Tier$0 - $101,000$0 - $202,0000%
Tier 1$101,001 - $118,000$202,001 - $236,0001.0%
Tier 2$118,001 - $158,000$236,001 - $316,0001.25%
Tier 3$158,001+$316,001+1.5%

*Family thresholds increase by $1,500 for each dependent child after the first.