Medicare Levy Surcharge Calculator 2026-27
Check whether you need to pay the Medicare levy surcharge.
Calculate whether the Medicare Levy Surcharge (MLS) applies to you in 2026-27. The MLS is 1%–1.5% of income if you earn over $105,000 and have no private hospital cover. ATO 2026-27.
MLS applies if income exceeds threshold and no appropriate private hospital cover is held.
How the Medicare Levy Surcharge works
Extra tax without hospital cover
The MLS is a 1%–1.5% additional tax for higher-income earners without adequate hospital-level private health insurance. It's assessed on top of the standard 2% Medicare levy and is designed to encourage take-up of private health.
Who pays?
Singles earning over $105,000 and families over $210,000 (2026-27) without approved hospital cover pay MLS. Extras-only cover does not exempt you — you need hospital cover.
Three income tiers for Medicare Levy Surcharge
| Single income | Family income | MLS rate |
|---|---|---|
| Up to $105,000 | Up to $210,000 | No MLS |
| $105,001–$123,000 | $210,001–$246,000 | 1.0% |
| $123,001–$164,000 | $246,001–$328,000 | 1.25% |
| Over $164,000 | Over $328,000 | 1.5% |
How hospital cover exempts you from Medicare Levy Surcharge
Hospital cover required
Holding any approved hospital cover policy from a registered Australian health insurer exempts you from MLS, regardless of income. The policy must include hospital treatment cover — extras-only cover does not qualify.
Government Rebate
The Private Health Insurance Rebate reduces your premium. At base income tier (under $105,000 single), the rebate is approximately 24% for under-65s. Higher incomes receive a reduced rebate, phasing to nil above $164,000 single (Tier 3).
❓ Frequently asked Frequently asked questions
What income triggers the Medicare Levy Surcharge?
Singles with income over $105,000 (2026-27) without approved hospital cover pay MLS. Family threshold is $210,000. Thresholds are indexed annually by the ATO.
Does extras-only cover exempt me from MLS?
No. You must hold hospital treatment cover from a registered insurer. Extras-only (dental, optical, physio) cover is not sufficient. Basic tier hospital cover is the minimum for MLS exemption.
Is MLS the same as the Medicare Levy?
No. The standard Medicare Levy (2%) applies to all taxpayers above a low-income threshold. The MLS (1–1.5%) is an additional charge only for higher-income earners without private hospital cover.
Can I take out cover mid-year to avoid MLS?
Yes, but you'll only be exempt for the days you held cover. For the days without cover, MLS applies pro-rata. It's worth taking out cover as soon as possible to minimise the MLS liability.
Where these figures come from
Every threshold and tax rate on this page is taken from the Australian Taxation Office (ATO) — the source of record for Australian income tax, Medicare levy, HECS/HELP repayment, and capital gains tax.
- Individual income tax rates (2025–26, Stage 3) — ATO — Individual income tax rates.
- Medicare levy & surcharge — ATO — Medicare levy.
- HECS/HELP repayment thresholds — ATO — Study and training support loans.
- Capital gains tax rules — ATO — Capital gains tax.
- GST rules — ATO — GST.
- Tax offsets & LITO/LMITO — ATO — Tax offsets.
Last checked: April 2026. Rates and thresholds are reviewed against the source of record each November, when annual adjustments for the following tax year are published.
Select the question that matches where you are right now.
Your result shows the estimated tax position based on the income, deductions, and offsets you entered — using current published tax rates and thresholds.
Use this to understand your tax position before lodging. Compare scenarios — a salary sacrifice, additional deduction, or income change — to see how each affects your tax.
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Tax results are driven by your total taxable income, marginal rate bracket, and eligible deductions. The interaction between these three determines your effective tax rate.
Each dollar above a threshold is taxed at the next rate. Moving from the 30% to the 37% bracket doesn't mean all income is taxed at 37% — only the portion above the threshold.
Deductions reduce taxable income (saving at your marginal rate). Offsets reduce tax payable dollar-for-dollar. An offset is worth more than a deduction of the same amount.
The 2% Medicare levy applies to most taxpayers. The surcharge (1–1.5%) applies if income exceeds thresholds and you don't hold private health insurance.
To reduce your tax, focus on legitimate strategies that shift income timing, increase deductions, or take advantage of concessional structures.
Claim all eligible work-related expenses, home office costs, and investment deductions. A tax agent can identify deductions you may be missing.
Contributions up to the concessional cap are taxed at 15% inside super instead of your marginal rate — an immediate saving for anyone above the 15% bracket.
Prepaying deductible expenses before 30 June or deferring income can shift your tax position between financial years.
Tax is connected to income, super, and investment decisions. Use these calculators to model the adjacent factors.
See exactly how much reaches your bank account after tax, Medicare, and HECS deductions.
Pay calculator →See the tax benefit of additional salary sacrifice or voluntary super contributions.
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