How HECS repayments work from 1 July 2025
Until 30 June 2025, your compulsory HECS/HELP repayment was a percentage of your entire repayment income; crossing a threshold by one dollar could add hundreds to your bill. From the 2025–26 year that system was replaced with marginal rates, like income tax: you only repay on the income above the threshold.
For FY 2026–27, the rates are:
| Repayment income | You repay |
|---|---|
| Up to $69,528 | Nil |
| $69,529 – $129,717 | 15c per $1 over $69,528 |
| $129,718 – $186,050 | $9,028 + 17c per $1 over $129,717 |
| $186,051 and over | 10% of your total repayment income |
Worked example: on a repayment income of $85,000, you repay 15c for each of the $15,472 above the threshold, which comes to $2,320.80 for the year, or about $89 a fortnight. Under the old system the same income would have owed roughly twice that.
What counts as “repayment income”
A common mistake (including in some other calculators) is using taxable income alone. The ATO calculates your repayment on repayment income, which is your taxable income (excluding any assessable First Home Super Saver amounts) plus:
- reportable fringe benefits (even from FBT-exempt employers),
- total net investment losses, including net rental losses,
- reportable super contributions (e.g. salary-sacrificed super),
- exempt foreign employment income.
This is why salary sacrificing into super doesn't reduce your HECS repayment even though it reduces your income tax: the sacrificed amount is added straight back as a reportable super contribution. Use the “Other repayment income” fields above to get the accurate figure.
What changed in 2025
Two big reforms took effect for HELP debtors:
- One-off 20% debt reduction. Every HELP, VET Student Loan and similar study debt that existed on 1 June 2025 was cut by 20%, before that year's indexation was applied. The ATO finished processing these credits in 2026; check your balance in ATO online services.
- Marginal repayments and a higher threshold. The minimum threshold jumped from $56,156 (2024–25) to $67,000 (2025–26, now $69,528), and repayments switched to the marginal rates above. Thresholds are indexed to average weekly earnings each year.
Indexation was also reformed in 2024: it is now the lower of CPI and the Wage Price Index, applied each 1 June (2.8% in 2026).
How the payoff projection works
The projection applies your assumed indexation to the balance each year, then deducts the year's compulsory repayment (repayments are credited at tax assessment, after 1 June indexation). Your income and the repayment thresholds both grow at your wage-growth assumption, mirroring how the ATO indexes thresholds to earnings. The “cost of indexation” figure is the total added to your debt along the way: the interest-equivalent cost of paying it off slowly. Full details on our methodology page.
Frequently asked questions
Why is the HECS amount withheld on my payslip different from this calculator?
Your employer withholds an estimate using ATO tax tables based only on the salary they pay you. What you owe is calculated when you lodge your tax return, using your full-year repayment income, which also counts fringe benefits, investment losses, reportable super contributions and exempt foreign income. If too much was withheld you get the difference back in your refund; if too little, it adds to your tax bill.
Are voluntary repayments worth making?
Voluntary repayments no longer attract any bonus or discount, but they reduce your balance immediately, and a payment made before 1 June reduces the amount that gets indexed that year. Whether paying down HELP debt beats other uses of your money depends on your situation; this is general information, not financial advice.
Does a HECS debt affect my home-loan borrowing capacity?
Generally yes. Lenders treat your compulsory repayment as an ongoing expense, which reduces how much you can borrow. Regulator guidance updated in 2025 gives lenders scope to disregard a HELP debt that is close to being fully repaid, so policies differ between lenders.
Sources
Figures on this page come from the following primary sources. The date is when we last checked the page against the source.
- Study and training support loans rates and repayment thresholds (ATO), checked 27 July 2026.
- Study and training support loans indexation rates (ATO), checked 5 October 2026.
- Study and training loans: what's new (ATO), checked 27 July 2026.
Related calculators & guides
Novated lease calculator: an FBT-exempt EV lease adds a reportable fringe benefit to your repayment income; compare before you sign. Salary sacrifice calculator: why sacrificing super doesn't cut your HECS repayment. Take-home pay calculator: what a raise means for your repayments.
Guide: HECS indexation in 2026 covers how the 1 June indexation works, the 20% debt cut, and what you can do about it.
Figures current as at 27 July 2026, verified against ATO published rates; see our methodology.