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Medicare levy variation declaration

Use this form to vary the amount withheld from your pay for the Medicare levy.

Last updated 31 October 2021

Easier ways to do this

Instead of a paper form, you can easily complete a Medicare levy variation declaration online. Visit myGov and go to ATO online services. Then, under the Employment menu, go to New employment and you can complete the declaration online.

How to get a copy of the form

You can download the Medicare levy variation declaration (PDF 424KB, NAT 0929)This link will download a file and either:

  • complete it on your computer, then save and print it
  • print a blank copy of the form and complete it by hand.

Who should use this declaration?

Complete this declaration if you want to:

  • increase the amount withheld from payments to you to cover your Medicare levy surcharge
  • claim an exemption from the Medicare levy
  • reduce the pay as you go (PAYG) amount withheld that covers Medicare levy from payments to you
  • claim an exemption from compulsory Higher Education Loan Program (HELP), VET Student Loan (VSL), Student Start-up Loan (SSL), Financial Supplement (FS) or Trade Support Loan (TSL) repayments.

Claiming an exemption or varying the amount withheld

Complete this declaration to claim an exemption from the Medicare levy or to vary the amount withheld for the levy if one of the following applies:

  • You are in one of the Medicare levy exemption categories.
  • The combined weekly income of you and your spouse is less than $924 or, if you maintain a child or student, less than the relevant amount shown in Table A.
  • You are a sole parent with a weekly income of less than $1,009 or, if you maintain more than one child or student, less than the relevant amount shown in Table A.
  • You have to pay the Medicare levy surcharge and want to increase the amount withheld from payments to you to cover the surcharge (for more information, see Question 4).

Also complete this declaration if you want to claim an exemption from HELP, VSL, FS, SSL or TSL repayments for a year because you are entitled to a reduction of the Medicare levy or you do not have to pay the Medicare levy, due to having a spouse or dependants and low family income.

Reduced Medicare levy

Most people in Australia have the Medicare levy automatically withheld from their wages. However, some people:

  • may qualify for an exemption from the levy
  • can pay a reduced levy
  • may have to pay the Medicare levy surcharge.

Refer to Table A to check if your weekly income qualifies you to either:

  • be exempt from the Medicare levy
  • vary the amount withheld for the levy.
Table A: Weekly income

Number of dependent children

Weekly income

0

$924

1

$1,009

2

$1,094

3

$1,179

4

$1,264

5

$1,349

6

$1,434

7

$1,519

8

$1,604

9

$1,689

10

$1,774

Help completing this form

Section A: Payee's declaration

In this section

Question 1 – What is your tax file number (TFN)?

We and your payer are authorised by the Taxation Administration Act 1953 to request your tax file number (TFN). It is not an offence not to quote your TFN. However, quoting your TFN reduces the risk of administrative errors and having extra tax withheld. Your payer is required to withhold the top rate of tax from all payments made to you if you do not provide your TFN or claim an exemption from quoting your TFN.

How do you find your TFN?

If you already have a TFN and don't remember the number, you can find it online in ATO online services through your myGov accountThis link opens in a new window.

If you don't have a myGov account, you can find your TFN on:

  • your notice of assessment
  • letters you have received from us, such as a statement of account
  • an income statement or payment summary (provided by your payer)
  • your superannuation account statement.

If you have a tax agent, you can ask them for your TFN.

If you still can't find your TFN after checking these options, phone us.

Questions 2 and 3

Complete with your personal information. For details about the information we collect see Privacy notice – Medicare levy variation declaration.

Question 4 – Do you want your payer to increase the amounts withheld from you to cover the Medicare levy surcharge?

You are liable for the Medicare levy surcharge if you meet all of the following conditions:

  • you and your dependants (including your spouse) are not in any of the three Medicare levy exemption categories
  • you do not have private patient hospital cover for yourself, your spouse and all your dependent children
  • you are either    
    • single, have no dependants and your income for surcharge purposes is more than $90,000
    • a member of a family that has a combined income for surcharge purposes of $180,000 or more. If you have more than one child, add $1,500 for the second and subsequent children.
     

The Medicare levy surcharge is income tested against the following income tier thresholds.

Single

Income threshold

Rate

$90,000 or less

0%

Tier 1
$90,001–$105,000

1%

Tier 2
$105,001–$140,000

1.25%

Tier 3
$140,001 or more

1.5%
Families

Income threshold

Rate

$180,000 or less

0%

Tier 1
$180,001–$210,000

1%

Tier 2
$210,001–$280,000

1.25%

Tier 3
$280,001 or more

1.5%

For more information, see:

If you and your spouse's combined income for surcharge purposes exceeded the family surcharge threshold described above, but your own income for surcharge purposes did not exceed $21,980, you are not liable for the surcharge for any part of the year. However, your spouse may still be liable for the surcharge.

If you take out private patient hospital cover during the year, or cancel your cover, you may be liable for the surcharge for the part of the year when you and all your dependants (including your spouse) were not covered.

Questions 5, 6, 7 and 8 – Claiming a Medicare levy exemption or reduction

Do you have more than one job?

If you are entitled to an exemption and have more than one job, you must lodge this declaration only with the payers you are claiming the tax-free threshold from.

If you receive income from more than one source, contact us to arrange for a reduced amount to be withheld from your income from other sources.

Full exemption

You are entitled to a full Medicare levy exemption if any of the following apply:

  • You and all your dependants are in one of the Medicare levy exemption categories.
  • You are in exemption category 1 and your dependants had to pay the Medicare levy (for example, your only dependant is your spouse who is not in an exemption category but has to pay the Medicare levy).
  • You are in exemption category 1 and have a dependent child who is not in an exemption category but the child is also a dependant of your spouse, who has to pay the Medicare levy.

If you are entitled to a full exemption, answer yes at questions 5 and 6 to claim the exemption.

Half exemption

You are exempt from half the Medicare levy if you are in exemption category 1 and have dependants who are not in an exemption category and do not have to pay the Medicare levy (for example, they are low income earners).

If you are entitled to a half exemption, answer yes at question 5, no at question 6, and yes at question 7.

Medicare levy exemption categories

You are in an exemption category if you were one of the following:

  • a blind pensioner or you received the sickness allowance from Services Australia category 1
  • entitled to full free medical treatment for all conditions under Defence Force arrangements or Veterans’ Affairs Repatriation Health Card (Gold Card) or repatriation arrangements – category 1
  • not an Australian resident for tax purposes – category 2
  • a member of a diplomatic mission or consular post in Australia (or a member of such a person's family and you were living with them) and you are not Australian citizen and do not ordinarily live in Australia – category 3
  • have a Medicare Entitlement StatementThis link opens in a new window (MES) from Services Australia showing the period in a year that you are not entitled to Medicare benefits. A letter from Services Australia is not sufficient – category 3.
Reduction based on family income

If you are not in an exemption category, you may be able to claim a reduction based on your family income. To be eligible, you must be in one of the following categories:

  • You had a spouse (married or de facto) on the last day of the financial year.
  • Your spouse died during the year and you did not have another spouse before the end of the year.
  • You were a sole parent at some time during the year (that is, you had sole care of any dependent children or students). This includes any child for whom you had sole care, not just your own child.

If you are eligible, one of the following must also apply:

  • You are a sole parent with a gross weekly income of less than $1,009 or, if you have more dependants, less than the relevant amount shown in Table A.
  • You have a spouse and your combined gross weekly income is less than $924 or, if you have one or more dependants, less than the relevant amount shown in Table A.

For example, the relevant income amount for both parents with two dependent children is $1,094 a week. If your combined weekly income is less than this amount, answer yes at question 8.

If you are entitled to a reduction, answer yes at question 8.

Questions 9 and 10

Complete with your personal information.

Question 11 – Do you have a Higher Education Loan Program (HELP), VET Student Loan (VSL), Financial Supplement (FS) Student Start-up Loan (SSL) or Trade Support Loan (TSL) debt?

Answer yes if you have a HELP, VSL, FS, SSL, or TSL debt.

Answer no if you do not have a HELP, VSL, FS, SSL or TSL debt, or have repaid your debt in full.

You have a HELP debt if either:

  • the Australian Government lends you money under HECS-HELP, FEE-HELP, OS-HELP, VET FEE-HELP, Vet Student loans prior to 1 July 2019 or SA-HELP
  • you have a debt from the previous Higher Education Contribution Scheme (HECS).

You have a SSL debt if you have an ABSTUDY SSL debt.

You have a separate VSL debt that is not part of your HELP debt if you incurred it from 1 July 2019.

For more information, see Study and training support loans.

Question 12 – Do you have dependent children?

Answer yes if you have dependent children and write the number of children at this question.

For more information, see Dependent child for Medicare levy family income reduction purposes.

Declaration

Make sure that you have signed and dated the declaration.

Give your completed declaration form to your payer.

Section B: Payer's declaration

This section is to be completed by the payer. The following information will help you comply with your PAYG withholding obligations.

Payer obligations

If you withhold amounts from payments, or are likely to withhold amounts, your payee may give you this form with section A completed. A Medicare levy variation declaration applies to payments made after the declaration is provided to you. The information provided on this form is used to work out the amount of tax to be withheld from payments based on the PAYG withholding tax tables we publish. If your payee gives you another declaration, it overrides any previous one.

Definitions

Child

A child includes:

  • your child
  • your adopted child, stepchild or ex-nuptial child
  • a child of your spouse
  • someone who is a child of yours within the meaning of the Family Law Act 1975.

Dependant

There are three different categories of dependants:

  1. Dependant for Medicare levy surcharge purposes
  2. Dependant for Medicare levy or half levy exemption purposes
  3. Dependent child for Medicare levy family income reduction purposes

Dependant for Medicare levy surcharge purposes

A dependant for Medicare levy surcharge purposes is a person wholly or partly maintained by you who is:

  • your spouse (of any sex)
  • a child aged under 21 years
  • a child aged 21 years to under 25 years who is a full-time student at a school, college or university.

Dependant for Medicare levy or half levy exemption purposes

A dependant for Medicare levy exemption purposes means a person who is:

  • a spouse (of any sex)
  • a child aged under 21 years
  • a child aged 21 years to under 25 years who is a full-time student at a school, college or university and has adjusted taxable income of less than $1,786 for the year.

If both you and your spouse are in Medicare levy exemption category 1 or 2 and you have dependent children who are not in any exempt category, one of you can claim a full levy exemption and the other a half levy exemption. You must complete a family agreement to nominate who will pay the half Medicare levy and keep it with your financial records.

Dependent child for Medicare levy family income reduction purposes

A dependent child for Medicare levy reduction purposes means a person maintained by you who is a child aged:

  • under 21 years who is not a full-time student and whose adjusted taxable income is less than $1,786 for the first child or $1,410 for any additional child
  • under 25 years and is a full-time student at a school, college or university and has adjusted taxable income of less than $1,786 for the year.

If you were not married on the last day of the income year or were married but living apart from your spouse, you must have received family tax benefit for that child or student for some part of the income year for them to be considered a dependant for family income reduction purposes.

Spouse

Your spouse is a person (of any sex) who either:

  • you are in a relationship with that is registered under a prescribed state or territory law
  • although not legally married to you, lives with you on a genuine domestic basis in a relationship as a couple.

Spouse weekly income

If the income of your spouse consists solely of salary or wages, the amount to be taken into account is the gross weekly earnings before tax. If your spouse has income other than earnings (for example, share dividends), you must take into account the weekly equivalent of all their income. To obtain this amount, divide their estimated taxable income from all sources by 52.

Medicare levy – income for surcharge purposes

A person's income for surcharge purposes for a financial year is the sum of their:

  • taxable income including the net amount you have paid family trust distribution tax on (excluding any First home super saver released amount)
  • exempt foreign employment income (if your taxable income is $1 or more)
  • reportable fringe benefits as reported on your payment summary or income statement
  • reportable super contributions (this includes both reportable employer super contributions and 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 that has not been included in their taxable income
  • total net investment loss (this includes both net financial investment loss and net rental property loss).

If you were aged from your preservation age to under 60 years old, any taxed element of a super lump sum – other than a death benefit – that you received that does not exceed your low rate cap is excluded from your income for surcharge purposes.

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