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See Category 3: Not entitled to Medicare benefits You will see it clearly shows what needs to happen.
To make it easy for you ..... it says in part:
To claim an exemption, you must first submit a Medicare entitlement statement to Medicare and receive a certification letter from them saying that you were not entitled to Medicare benefits for a particular period. You can then claim the exemption for the period that Medicare has advised.
You need to submit a Medicare entitlement statement to Medicare each year you want to claim an exemption.
For more information on how to apply for a Medicare entitlement statement as a temporary resident, go to servicesaustralia.gov.au
As for when it comes to lodging the instructions simply say:
If you were a temporary resident for Medicare purposes and have a Medicare entitlement statement from Services Australia covering a period in 2019–20 (see Category 3), then print C in the CLAIM TYPE box.
You should keep the document should we ask you to produce it.