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Worried you’re missing part of your refund? Remember, the low and middle income tax offset isn’t a refund on its own – it’s used to offset (or reduce) the amount of tax you pay. The offset amount you may be entitled to is automatically applied and could range between $255-$1080, depending on things like your taxable income and how much tax you’ve paid.
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HELP loan not decreasing

Newbie

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Replies 5

I have been working in a job for 2 years that deducts around $120/fortnight labeled as ‘Taxation - HELP Amount’. When logging onto MyGov to check how much is still owing on my loan, the amount has not decreased, but has actually gone up! I have read that I need to wait until I lodge my Tax Return to see a decrease, but I lodged my tax return last year and there was no change.
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Most helpful response

Devotee

Replies 3

The HELP deduction is actually "tax" and not a loan repayment at the time it is withheld. When you lodge your tax return your total income determines if you have to make a repayment, which is then calculated in your refund.

 

If your income last year was under the HELP repayment threshold, all of that extra "tax" (loan repayment) would have been refunded to you - in which case your HELP debt wouldn't decrease.

 

If your income this year is over the threshold, your tax assessment will include normal tax on your income + HELP repayment. If these combined are less than the amount of tax withheld from your wages (which is normal tax + the amount labelled loan repayment), you will still get a refund. If they are higher, you will have a payable.

5 REPLIES 5

Most helpful response

Devotee

Replies 3

The HELP deduction is actually "tax" and not a loan repayment at the time it is withheld. When you lodge your tax return your total income determines if you have to make a repayment, which is then calculated in your refund.

 

If your income last year was under the HELP repayment threshold, all of that extra "tax" (loan repayment) would have been refunded to you - in which case your HELP debt wouldn't decrease.

 

If your income this year is over the threshold, your tax assessment will include normal tax on your income + HELP repayment. If these combined are less than the amount of tax withheld from your wages (which is normal tax + the amount labelled loan repayment), you will still get a refund. If they are higher, you will have a payable.

Newbie

Replies 2

Thank you for your reply! I’ve just checked last years (18-19) lodge and it says that my taxable income was $50k and my tax withheld was $13.5k. This would be above the threshold, would it not?

Devotee

Replies 1

I think the threshold is just shy of $52k.

 

Did you get a large tax refund? If yes, that will be all the HELP loan repayments.

Newbie

Replies 0

Yes! You are correct. I earned just under 52k. Thanks for your help Smiley Happy

Former Community Support

Replies 0

Hi @Ceb24 

 

Both you and @MCA_Accountants  are correct, the amounts your employer withholds from your pay will not come off your loan until after you have lodged your tax return and we calculate your repayment amount. When your compulsory repayment is calculated it will come off your loan as an annual lump sum.

 

In the 2018-19 financial year the HELP repayment income threshold was $51,957. If you earnt less than the threshold amount, you would receive the tax as a refund. You can check your Notice of assessment for the 2018-19 year on ATO Online via myGov.

 

You may consider making voluntary repayments to reduce your balance faster.

 

Thanks for contacting us.