I turned 31 late last year, and am currently covered as a dependant on my parents' private health insurance policy (and can be until I'm 32 in line with the insurer's policies). Do I need to take out health insurance in my own name by 1 July 2026 to avoid the medicare levy surcharge, or can I wait until my 32nd birthday (when my coverage as a dependant runs out).
Too late if your income is now over the MLS income threshold.
An adult dependent under a private health insurance policy is not the same as an adult dependent for the MLS.
For adult dependents:
"A person over the age of 21 who is not a full-time student is not considered a dependent for MLS purposes. A person who is covered as a dependent aged over 21 on a family hospital policy, who also earns over the MLS income threshold, is liable to pay the MLS. To be exempt from the MLS, the person needs to take a hospital policy for themselves. "
Hi @bec_123,
The key issue for the Medicare Levy Surcharge (MLS) isn’t whether your insurer treats you as a dependent. It’s how ‘dependent’ is defined for MLS purposes.
For MLS, we treat someone as a dependent child if they are:
This means that at age 31, you are not considered a dependent for MLS purposes, even if your health fund allows you to remain on a family policy.
To avoid the MLS, what matters is that you personally have appropriate private hospital cover for each day of the financial year if your income is above the threshold. Simply being covered under your parents’ policy does not automatically mean you are exempt from the MLS, because you are treated as an independent adult under the tax rules.
As a result:
Once that cover ends (e.g. when you turn 32), you'd need to arrange your own policy if you want to continue avoiding MLS and your income is above the threshold.
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