Private health insurance eases tax burden
Australian tax payers could've avoided paying around $128 million in total in the Medicare Levy Surcharge, according to the Australian Tax Office (ATO), if more people took up private health insurance.
The latest taxation statistics from the ATO show that 210,742 personal taxpayers, liable to pay the Medicare Levy Surcharge, pay on average an extra $608 per person by not having adequate private hospital cover.
With tax season looming, Australia's largest private health insurer, Medibank Private is reminding Australians that being privately insured with a registered health fund can deliver the additional benefit of tax savings.
This is because taxpayers are currently liable to pay a Medicare Surcharge Levy, an additional 1% surcharge of taxable income imposed on income earners that do not have appropriate hospital cover with a registered health fund. The Surcharge is additional to the 1.5% Medicare Levy.
Medibank Private Managing Director, Mr George Savvides said, "Ensuring you have appropriate private health cover could save you in tax every year."
"So deciding to take up private health insurance is not just a good health decision, it is also a good financial decision. It all adds up; while protecting yourself and your health needs you are also saving money."
"Having the peace of mind with private health insurance that you and your family have greater control over when and where you will receive the best possible care if you need it, is one thing - having peace of mind that you are not paying extra tax makes it even better." Mr Savvides said.
If you are single and have an annual taxable income of $50,000 or $100,000 as a couple or family, and don't have adequate private health insurance, you will incur a 1% surcharge on top of the 1.5% Medicare Levy. The income threshold for the Surcharge increases by $1,500 for each child, after the first.
For example a single person earning $60,000 and paying $401.90 annually for Medibank Private 'First Choice Saver Hospital' cover is saving $198.10, which they would otherwise have to pay as part of the Surcharge."
Mr Savvides added, "All Medibank Private hospital products qualify taxpayers for an exemption from the Medicare Surcharge Levy."
- The following table details the potential tax benefits of being insured with Medibank Private. It is based on an individual with a taxable income of $60,000 per annum. Savings increase by $100 for every $10,000 increase in income.
|STATE||FIRST CHOICE SAVER HOSPITAL|
Excess Level 2 - $250
|FIRST CHOICE HOSPITAL|
Excess Level 3 - $500
** Saving reflects difference between not paying the Medicare 1% Surcharge less the cost of Private Health Insurance, after deduction of 30% Federal Government rebate.
For more information contact the Australian Taxation Office, or consult a tax professional. Australian Taxation Office (ATO) Helpline on 13 28 61 or visit www.ato.gov.au.
For media enquiries, please contact:
Media Adviser, Medibank Private
Phone: 03 8622 5181
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