Hi everyone
Is this mandatory if one makes more than 90k a year and one doesn't have private health insurance? What if the combined income (with one's spouse) is not 180k? Or what if one makes more than 90k, but has deductions that brings the taxable income below 90k?
And also compulsory if you do have private health cover.
Confuse the standard levy with the surcharge, my bad.
has deductions that brings the taxable income below 90k?
It doesn't work like that.
Income for MLS purposes is different to your taxable income
https://www.ato.gov.au/individuals/medicare-levy/medicare-le…
You can make a charity donation to put yourself $1 under the threshold for high income earners and potentially save thousands in tax via lowered medicare surcharge? I've heard differently in the past.
https://www.ato.gov.au/individuals/medicare-levy/medicare-le…
It is based on your taxable income…
Taxable income = assessable income – allowable deductions
https://www.ato.gov.au/Non-profit/Your-organisation/In-detai…
I've heard differently in the past.
Time to replace your accountant, or stop taking tax advice at the pub on Friday nights.
If combined income is less than 180k then no need to pay. For example one partner could make 150k and the other 20k. In that scenario no levy.
Levy Surcharge: is based on the MLS assessable income, which includes a number of reportable incomes, deductions and benefits. So deduction doesn't lower it
Levy: is based on taxable income. Deduction lowers that.
So many people getting the MLS calculation wrong here.
Your income for MLS purposes is the sum of the following items for you (and your spouse, if you have one):
taxable income
include the net amount on which family trust distribution tax has been paid
do not include any assessable first home super saver (FHSS) released amount for the income year under the FHSS scheme
reportable fringe benefits
total net investment losses – includes both
net financial investment losses
net rental property losses
reportable super contributions – includes both
reportable employer super contributions
deductible personal super contributions
if you have a spouse, their share of the net income of a trust on which the trustee must pay tax (under section 98 of the Income Tax Assessment Act 1936) and which has not been included in their taxable income.
If you had exempt foreign employment income, and your taxable income is $1 or more, add your exempt foreign employment income to your taxable income.
If you (or your spouse) are aged from your (or their) preservation age to under 60 years old and received a super lump sum, reduce income for MLS purposes by any taxed element of the lump sum, other than a death benefit, that does not exceed your (or their) low rate cap.
Medicare levy is compulsory if you don't have appropriate level of private health cover https://www.ato.gov.au/Individuals/Medicare-levy/