What is a HECS-HELP debt?
It’s a higher education loan payment that works a bit like a loan, but instead of the funds coming from a bank, the government makes a payment to your university on your behalf, saving you from potentially big upfront costs.
These loans don’t incur interest, and they don’t have an end date. Once you start working and earn over the income threshold of $54,435*, payments will commence via your employer’s payroll.
The amount payable is based on a certain percentage of your income; the higher you earn, the higher the repayment rate. For more information on this click here.
*FY2024-25 figure – thresholds change annually
Good news: You can still salary package and have a HECS-HELP debt.
If you’re seeking a better way to pay off your HECS-HELP debt, salary packaging can help. With a Maxxia salary packaging account, you could put more money in your pocket each year and pay off your HECS-HELP sooner – win-win!
How it works
To make the most of your salary packaging and avoid being stung at tax time, all you need to do is ask your payroll department to deduct additional HECS-HELP repayments.
Maxxia can help you work out how much with our HECS-HELP calculator.
Follow the steps in our online calculator here.
Pay less tax and pay down your uni debt sooner
These videos explain the potential benefits of salary packaging with a HECS-HELP debt in more detail.
Health
Let’s say you’re a health worker with a HECS-HELP debt earning $60,000. By packaging your full living expenses benefit of $9,010, as well as Meal Entertainment benefit of $2,650, you could be almost $2,489 better off each year!*
While your HECS-HELP repayments increase as they are calculated on this adjusted income, you could still increase your disposable income each year through reduced tax.
*Estimate Only: Individual circumstances may vary
Charity
Let's say you work for a not-for-profit organisation earning $60,000. By packaging your full living expenses benefit of $15,900, as well as Meal Entertainment benefit of $2,650, you could be almost $3,263 better off each year!*
While your HECS-HELP repayments increase as they are calculated on this adjusted income, you could still increase your disposable income each year through reduced tax.
*Estimate Only: Individual circumstances may vary
FAQs
Got questions? We’ve got answers.
Can I salary package additional HECS-HELP debt repayments? | Maxxia
Yes you can. Additional HELP repayments can be salary packaged if you wish to pay your HECS-HELP debt off sooner.
Example:
Barry has a debt of $4,500 and makes a $1,500 voluntary repayment, reducing his total debt to $3,000.
Use our HECS-HELP calculator for salary packaging.
Contact us on 1300 123 123 to see how salary packaging could help you pay your HECS-HELP debt off sooner and increase your disposable income.
How do I make sure I do not end up with a shortfall at tax time for unpaid HECS-HELP repayments? | Maxxia
Salary packaging could reduce your taxable income but may affect the way the ATO calculates your HECS-HELP repayments – which could leave you with a tax bill at tax time. So your employer may not be taking out enough HECS-HELP repayments or in some cases, may not be deducting any HECS-HELP repayments at all.
To avoid a possible shortfall at tax time for unpaid HELP repayments, you need to let your payroll department know when you start salary packaging as they may need to increase or recommence the amount of your withholding tax deductions.
While each employer is different, in most cases your payroll department will be able to help you manage the process and changing your HECS-HELP repayments is quite simple to do. Your payroll department may have its own form or they may ask you to use the ATO's form Tax declaration form or Withholding tax form. Check with your payroll department first.
This is quite simple to do and in most cases your payroll department will be able to help you manage the process.
Start getting more in your pocket each year and paying more off your HECS-HELP today.
Salary Packaging: The estimated potential tax benefit is based on the assumption that the disposable income is based on an eligible employee with an annual salary of $60,000 salary packaging to a $9,010 per annum limit and claiming $2,650 in venue hire and meal and entertainment expenses. PAYG tax effective 1 July 2024 have been used. HELP repayments are based on 2024-2025 HELP repayment thresholds and rates. An average salary packaging administration fee has been used. The actual administration fee that applies to you may vary depending on your employer. Estimated annual benefit based on the assumption that an employee does not have any accumulated Financial Supplement debt. Your disposable income will vary based on your income and personal circumstances. Compulsory HELP repayments commence once your adjusted taxable income reaches $54,435
The Meal Entertainment benefit has a maximum annual cap limit of $2,650. This will appear as a reportable fringe benefit on your Payment Summary each year which will be included in a number of income tests relating to certain government benefits and obligations. This cap is separate from the FBT cap limits for everyday living expenses. The Meal Entertainment benefit does not cover take-away meals, groceries or eating out on your own.
Important Information: This general information doesn’t take your personal circumstances into account. Please consider whether this information is right for you before making a decision and seek professional independent tax or financial advice. Conditions and fees apply, and you should consider if they are acceptable before you accept any arrangements with Maxxia, along with credit assessment criteria for lease and loan products. The availability of benefits is subject to your employer’s approval. Maxxia may pay and/or receive commissions in connection with its services.
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