Do Compulsory Higher Education Loan repayments still need to be paid if I make voluntary payments?

Question

 · Accepted Answer

RileyATO · Answer

Yes, you still have to make compulsory repayments to your HECS/ HELP study loan, even if you make voluntary repayments. The compulsory repayment is worked out by how much you earn. For example if you make between $51,550 and $59,518, your repayment rate (https://www.ato.gov.au/tax-rates-and-codes/study-and-training-support-loans-rates-and-repayment-thresholds#Tool) will be 1%. So if you make $55,000 in the financial year, your compulsory repayment is $550. This is regardless of if you've made voluntary repayments. However, voluntary repayments will decrease the total amount owing in your loan and therefore will reduce the amount you're indexed by. So your loan won't increase from indexation as much as it would if you weren't making voluntary repayments. We've got an article about paying your student loan (https://community.ato.gov.au/s/article/a079s0000009GnGAAU/paying-my-hecs-help-student-loan) that breaks all this down if you want to check it out.

Explore tax & super topicsExplore tax & super topics

About usAbout us