Tax time.

Zim^zuM

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#1
Anyone here an accountant.

Reason I ask is looking at my return last year i paid $1700 in a medicare levy. I have private health and in my assesment it saud I am not liable for the levy yet was slugged the $1700. Would anyone have any insight as to why??

Same happened to my wife who was slugged $800
 

jaca

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#2
I *think* you may be confusing the Medicare Levy and the Medicare Levy Surcharge.

Medicare Levy Surcharge is the one you avoid with PH cover. Medicare Levy everyone pays on their taxable income.
 

quite ironic

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#3
Yeah I’m an accountant actually.

Medicare levy is 2% tax on your taxable income, payable for all individuals.

Medicare levy surcharge is for people who don’t have PHI. Applicable for individuals once your rebateable income is >$90,000 or $180,000 combined for couples.
 

Zim^zuM

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#4
Thanks for the reply. Care to get into a bit more detail if possible?

Some brief facts is we do have private health. Im more asking for last year as this year i know we will be well above the 180.

Last year though i was just under 90k have private health and was charged 1700. The missus figures are then half in all areas. Half the wage charged half my levy. My question is if we earnt under the 90k single and 180k couple mark why were we both still charged the 2%
And why in the analysis of the return does it say we both arent liable to pay the levy but charged 2%

Thanks in advance :)
 

quite ironic

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#5
Thanks for the reply. Care to get into a bit more detail if possible?

Some brief facts is we do have private health. Im more asking for last year as this year i know we will be well above the 180.

Last year though i was just under 90k have private health and was charged 1700. The missus figures are then half in all areas. Half the wage charged half my levy. My question is if we earnt under the 90k single and 180k couple mark why were we both still charged the 2%
And why in the analysis of the return does it say we both arent liable to pay the levy but charged 2%

Thanks in advance :)
Was she reported as a spouse on your tax return and private health insurance cover?

If so, you shouldn’t have to pay the surcharge at all unless private health insurance cover was reported as ‘no’ in the tax return.

Something worth checking with your accountant that I picked up on our APS Tax Software last year, you can enter all the private health insurance figures but the ‘do the individuals have private health insurance cover’ was often left as a default to no on the system. This would then not create an error m but meaning the surcharge would be calculated as tax owing, if meeting the criteria of being over 180k rebateable income combined.

I would be thinking (but not being able to see it) you paid the 2% Medicare levy on your taxable income (say 85k x 2% = $1700) which is due for every individual in Australia regardless of having private health insurance or not.

I would think you didn’t actually have to pay any surcharge (which is what the private health insurance covers) but just the normal 2% levy.
 

Zim^zuM

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#6
Thanks for taking the time to respond. Will def chase it up when i do my return just dont want to look like a dill.

Yes she was listed as a spouse. One thing we have uncovered is despite mine being listed as Y hers is listed accidentally as N and she is the primary person on the policy.

To make things more clearer for me on my notice of assessment last year should there be no charge at all for the levy? Or the 1700 based on 85k sounds correct and my phi just made it less?

Looking back through old tax returns there has always been a levy charged. Even when she was working part time and only took 33k but had phi.

Thanks for the time your taking once again to answer my questions. Also if there are errors due to her having N are these something that can be reversed?
 
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