First time getting health insurance. When filling out application to receive the Australian Government Rebate on Private Health Insurance as a reduced premium, it asks for my income tier. Is this income tier:
1) as at now (financial year ending 30 June 2016) or
2) expected income tier for the financial year ending 30 June 2017
Is there any issues with getting the income tier wrong? It says there are penalties for giving false information but there no way to be sure of my income in the future
Ok so I'm meant to fill in the application at the end of the financial year, not the start? I'm getting health insurance for next year so I'm not actually claiming anything for this income year (there's only a few days left). Part of the application for health insurance will ask for my income tier. Do I just use my current income then?
You can either do it at the end of the year, or get the rebate upfront when you pay your premiums.
If you want to get the rebate upfront (if you're cash flow savvy), you can contact your PHI provider on how to claim it. And from what you are saying, it is likely they can give you the rebate upfront. Giving an estimate income tier is completely fine (just as using your current income is fine as well), as you can always tell your PHI provider if your income significantly changes (like moving from tier 1 to tier 3 for instance). Just ensure that you put on your tax return for that year how much you have already claimed directly with your provider.
You should be giving the income tier of the year you are claiming for. So for this this case, you are probably claiming for the 2015-16 financial year, so you will use your 2015-16 income.
Declaring the wrong income tier will usually only get you a tax liability/refundable of the shortfall/overpayment. However it is at the ATO's discretion to determine if you maliciously attempted to tax evade, or even tax avoid (under Part IVA), and penalise you appropriately.