How does HECS work?
A loan for uni that you repay through your tax once you earn enough, and it grows a little each June.
Repayments start above $69,528 of repayment income and, since 2025-26, apply only to the income above that.
The rule
- 2026-27 repayments: nothing up to $69,528 of repayment income. Then 15c for each $1 over $69,528 up to $129,717. Then $9,028 plus 17c for each $1 over $129,717 up to $186,050. From $186,051, 10% of the whole repayment income.
- Since 2025-26 the repayment is worked out on the income above each threshold, so there is no sudden jump. At $186,050 the repayment is $18,604.61 and at $186,051 it is $18,605.10.
- Repayment income is taxable income plus reportable fringe benefits, total net investment loss (including rental losses), reportable super contributions and exempt foreign employment income. Salary sacrificed to super still counts.
- On 1 June each year the ATO applies indexation to the part of the loan that has been unpaid for more than 11 months. It is the lower of the CPI and the WPI changes: 2.8% in 2026, 3.2% in 2025, 4% in 2024 (it was 4.7%) and 3.2% in 2023 (it was 7.1%).
- The years to clear on this page is a model. It uses one indexation rate every year and holds the 2026-27 repayment thresholds. The ATO sets both again each year.
What people ask
Why is HECS indexed before payment?
The ATO applies indexation on 1 June to the part of the loan unpaid for more than 11 months. The model on this page takes a year's indexation first and then that year's repayment, as a simplifying choice. Your own balance and its dates are on your ATO statement.
How much is the HECS repayment on $80,000?
In 2026-27, with repayment income of $80,000, it is 15c for each $1 over $69,528, which is $1,570.80 for the year.
Is HECS indexed to inflation?
It is indexed to the lower of the CPI and the Wage Price Index. The 2026 rate was 2.8%.
Does salary sacrifice reduce my HECS repayment?
No. Reportable super contributions are added back into repayment income, so moving pay into super does not lower the repayment.
How long will it take to pay off HECS?
It depends on the balance, the income and the indexation rate. If the 15c slice of income above the threshold is smaller than the indexation added each June, the balance grows. The widget above shows the years under the numbers you type, and says when it never clears.