The ATO has reminded taxpayers of changes made last year to means test the 30% private health insurance rebate. Individuals earning more than $84,000, or families earning more than id=”mce_marker”68,000, will start to lose the rebate in the 2012-13 financial year. The ATO said it will work out the rebate entitlement of taxpayers when they lodge their tax returns and that this may result in a refund or a liability.
The income test thresholds are based on the income for Medicare levy surcharge purposes. There has been no change to when the Medicare levy surcharge may apply or to any of the existing exemption categories. The only change has been the introduction of new income thresholds and Medicare levy surcharge rates. The ATO has published tables to help taxpayers determine their rebate entitlement percentage and the rate of Medicare levy surcharge that may apply.
The ATO said that if taxpayers have prepaid their private health insurance for 12 or 18 months in 2011-12, they still need to complete the private health insurance policy section of their 2012-13 tax return using the information on their private health insurance statement (including the $0 values). It added that taxpayers who have paid their private health insurance in 2011-12, and who have their next payment due in 2013-14, may wish to contact their private health insurer to discuss their income level and review their arrangements.
[LTN 112, 13/6/13]