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Re: HECS Debt - Can I avoid employer deductions?

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Hi, Right now my employer is deducting the HECS debt on a weekly basis. This is reducing my take-home drastically. Can I pay the HECS debt towards the end of the tax year and ask my employer not to deduct?

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Hi @diwa008,

 

Thanks for getting in touch.

 

If you earn income over the Higher Education Loan Program (HELP) repayment threshold and you have indicated on your TFN declaration that you have a HELP debt your employer will automatically withhold the required percentage from your income. This is done to ensure you won't have a tax debt at the end of the financial year.

 

Once your HELP debt has been paid in full, you can advise your employer that you no longer need to make compulsory repayments by completing a withholding declaration (NAT form 3093)

 

All the best,

 

JacquelineATO

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Community Support

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Hi @diwa008,

 

Thanks for getting in touch.

 

If you earn income over the Higher Education Loan Program (HELP) repayment threshold and you have indicated on your TFN declaration that you have a HELP debt your employer will automatically withhold the required percentage from your income. This is done to ensure you won't have a tax debt at the end of the financial year.

 

Once your HELP debt has been paid in full, you can advise your employer that you no longer need to make compulsory repayments by completing a withholding declaration (NAT form 3093)

 

All the best,

 

JacquelineATO

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Community Support

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Hi @diwa008 

 

There is a Community knowledge base article paying my HELP debt.

You should inform your employer of your study loan on your tax file number declaration form or withholding declaration form if you’re already employed. This lets them know to withhold amounts from your pay throughout the year to cover your anticipated compulsory repayment.

Your employer is then required to withhold the HELP amount from each of your weekly payments according to the Study and training support loans weekly tax table.

If your employer is withholding the correct amounts, next examine an option available to some people to apply to vary an amount of withholding. However the main purpose of varying your rate or amount of withholding is to make sure that the amount withheld during the income year best meets your end-of-year tax liability. For example, you may want to apply for a variation if the normal rate of withholding leads to a large credit at the end of the income year because your tax-deductible expenses are higher than normal.

If your only reason to apply is that you wish to defer weekly withholdings in order to pay a large liability at the end of the year - then you would not fit the criteria to apply for a variation, and would need to continue having HELP withheld from your weekly pay.

 

Hope you found this helpful.