I have a $20000 HECS debt owing, Just want to find out if we still get a tax return refund or does it contribute straight to the Loan?
Tax Return on HECS Debt
jayden335 on 14/06/2018 - 17:18
Comments
There is a scale on what percentage of your taxable income you will pay off your HECS based on your taxable income.
It is available at the ATO website.
The amount is small so it is unlikely if you have an average refund that the HECS component will gobble it up.
It depends on your income not the amount of debt. If you earn less than $55k then you don't need to pay it. Otherwise you do but as long as you told your employer you had one you should have already had the default payment taken as part of your tax.
It gets withheld just like tax if you have told your employer that you have HECS debt. ATO will count HECS as extra tax needing to be paid, basically. If you've paid more tax than you should have, you'll get a refund. Online tax calculators are good for this to work out how much tax should have been withheld.
your hecs is a tax component, simple example:
marginal tax rate = 30%
hecs = additional 5%
tax on taxable salary = 35%
More info here:
https://www.studyassist.gov.au/paying-back-my-loan/loan-repa…
TLDR: you get a refund if it is owed to you