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Calculate your HECS-HELP repayment under the new marginal rate system. The threshold has risen to $67,000, and repayments are now calculated only on income above the threshold — not your entire salary.
HECS-HELP repayments are calculated using a marginal rate system that applies tiered rates only to income above the $67,000 threshold in FY2025-26.
The Australian Tax Office determines your "repayment income" by adding your taxable income, net investment losses, reportable fringe benefits, reportable super contributions, and exempt foreign employment income. This repayment income figure — not your gross salary alone — dictates the HECS calculation applied to your tax return.
A graduate earning $85,000 per year has $18,000 of income above the $67,000 threshold. The HECS repayment calculation is:
($85,000 − $67,000) × 0.15 = $2,700 per year
Weekly impact: $51.92 per week
Use our Pay Calculator to see how this HECS repayment fits into your complete after-tax income breakdown, including income tax brackets, the Medicare levy, and superannuation.
The HECS-HELP repayment threshold for FY2025-26 is $67,000, up from $54,435 in FY2024-25 — a 23.1% increase.
| Repayment Income | Rate | How It's Calculated |
|---|---|---|
| $0 – $67,000 | Nil | Below threshold |
| $67,001 – $125,000 | 15% | 15c per $1 over $67,000 |
| $125,001 – $179,285 | 17% | $8,700 + 17c per $1 over $125,000 |
| $179,286 and over | 10% | 10% of total repayment income |
Repayment income includes your taxable income plus net investment losses, reportable fringe benefits, reportable super contributions, and exempt foreign employment income. These thresholds apply to all "Study and Training Support Loans" including HECS-HELP, FEE-HELP, VET Student Loans, and SA-HELP.
Over 3 million Australians hold a HELP debt as of 2025, making this calculator relevant to a significant share of the workforce.
Pair this tool with our Income Tax Calculator to see the combined effect of income tax brackets, the Medicare levy, and HECS on your after-tax income.
HECS reduces your take-home pay by between $8.65 and $152.88 per week for salaries between $70,000 and $120,000.
| Gross Salary | HECS Repayment | Per Week | Take-Home (with HECS) | Take-Home (no HECS) |
|---|---|---|---|---|
| $60,000 | $0 | $0.00 | $50,112 | $50,112 |
| $67,000 | $0 | $0.00 | $54,772 | $54,772 |
| $70,000 | $450 | $8.65 | $56,362 | $56,812 |
| $75,000 | $1,200 | $23.08 | $59,012 | $60,212 |
| $80,000 | $1,950 | $37.50 | $61,662 | $63,612 |
| $90,000 | $3,450 | $66.35 | $66,962 | $70,412 |
| $100,000 | $4,950 | $95.19 | $72,262 | $77,212 |
| $120,000 | $7,950 | $152.88 | $82,862 | $90,812 |
At $60,000 and $67,000, no compulsory HECS repayment applies because income sits below the $67,000 threshold. The jump from $67,000 to $70,000 costs only $450 in HECS ($8.65/week) — a key benefit of the new marginal rate system. Take-Home Pay Calculator provides a full net pay breakdown at any salary.
The FY2025-26 financial year introduced the biggest reform to HECS repayments in 35 years, replacing the flat-rate system with marginal-rate calculations and capping indexation.
| Old System (Before FY2025-26) | New System (FY2025-26+) | |
|---|---|---|
| How it worked | Flat % on total income | Marginal rate on income above threshold |
| Threshold | $54,435 | $67,000 |
| Smallest repayment | 1% of entire income ($544) | 15c per $1 over $67,000 |
| Cliff effect | Earning $1 over threshold triggered repayment on entire income | Gradual increase — no cliff edge |
| Indexation cap | CPI only (hit 7.1% in 2023) | Lower of CPI or WPI |
HECS debts are indexed on 1 June each year at the lower of CPI or the Wage Price Index (WPI). The government introduced this cap after CPI-based indexation hit 7.1% in June 2023, adding thousands of dollars to outstanding balances overnight. The new cap was backdated to June 2023, reducing that year's indexation to 3.2%. For FY2025-26, the indexation rate is expected to remain between 2.5% and 3.5% based on forecast WPI growth.
Voluntary repayments made before 1 June reduce the balance before indexation is applied. Use our Superannuation Calculator to compare whether extra super contributions or HECS repayments offer better long-term value.
The most common HECS mistake is not ticking the HELP debt box on the Tax File Number declaration, which causes a large tax bill at end of financial year instead of regular PAYG withholding.
Voluntary repayments reduce your HECS debt faster, but the financial benefit is limited because HECS is indexed to CPI or WPI — not charged market-rate interest. The effective rate is typically 2.5% to 3.5%, well below a mortgage rate of 6% to 7%.
HECS is one component of your total pay deductions. These Australian tax calculators provide the full picture of your salary, tax, and net pay for the 2025-26 financial year.
Get the complete picture with income tax, Medicare, HECS, and super — all in one calculation.
Pay Calculator →Last verified: 14 March 2026. Our content is based on the latest information from official Australian government sources.