HECS Debt Calculator Australia — 2025–26 Repayments, Indexation & Strategy
G'day. I built this site because the ATO's HECS pages read like they were written by a tax lawyer who hates graduates — and I got sick of watching mates cop a $6,000 indexation hit they didn't see coming. Four free calculators and twenty plain-English guides covering every HECS-HELP question you're actually asking. Built in Melbourne, updated against the 2025–26 ATO thresholds the week they drop.
Start with the right calculator
Pick the tool that matches the question you are actually asking. Every calculator uses current ATO data and is free — no login, no email, no export paywall.
HECS Repayment Calculator
Enter your income and see your compulsory 2025–26 HECS repayment in minutes. Shows annual, monthly, fortnightly and weekly amounts.
HECS Indexation Calculator
Project how much indexation will add to your balance on 1 June. Models multi-year debt growth under WPI-capped rules.
HECS & Home Loan Calculator
See how your HECS debt reduces borrowing capacity. Lenders treat compulsory repayments as fixed expenses — this calculator shows the real impact.
Voluntary Repayment Calculator
Compare what you save by paying voluntarily before 1 June indexation vs investing the same money. Factors WPI cap and your tax bracket.
How HECS-HELP debt actually works in 2026
HECS-HELP is Australia's income-contingent student loan system. You only repay when your repayment income — taxable income plus reportable super, reportable fringe benefits, net investment losses and exempt foreign employment income — exceeds the compulsory threshold.
For FY2025-26 that threshold is $67,000 under the new marginal repayment system (effective 1 July 2025). Below it you pay nothing. Above it, you pay 15c for every $1 earned over $67,000 up to $125,000, then $8,700 plus 17c on each dollar over $125,000, then 10% of whole income above $179,286. This replaced the old 18-bracket whole-of-income system that ran from $54,435 to $151,201.
On 1 June each year, any balance that's outstanding is indexed. Since the 2024 reforms, indexation is capped at the lower of CPI or the Wage Price Index (WPI) — meaning HECS now grows roughly in line with wages instead of the cost of living. The 2025 indexation rate was 3.2%.
| Repayment income | Repayment calculation |
|---|---|
| $0 – $67,000 | Nil — no compulsory repayment |
| $67,001 – $125,000 | 15c for every $1 over $67,000 |
| $125,001 – $179,285 | $8,700 + 17c for every $1 over $125,000 |
| $179,286 and above | 10% of total repayment income (whole-of-income) |
Big change from 2024-25: The new marginal system means repayment is calculated only on income above $67,000 (except at the top bracket). Under the old system, the rate applied to your entire income. Source: Australian Taxation Office — Repayment thresholds and rates 2025-26; Higher Education Legislation Amendment (20% Reduction of HELP Debts) Act 2025. Repayment income = taxable income + reportable fringe benefits + reportable super + net investment loss + exempt foreign employment income.
Which guide answers your question?
The calculators give you a number. These guides explain the decision behind the number.
- Indexation explained — why 1 June matters and how the WPI cap changed the maths.
- Should I pay off HECS early? — the decision tree most graduates need.
- HECS debt reduction options — the 2024 write-off, employer arrangements, and what's real vs rumour.
- Does HECS affect your home loan? — the actual borrowing power impact, bank by bank.
- Salary packaging with HECS — why it can make your debt bigger, not smaller.
- Repaying HECS while overseas — the worldwide income rules nobody tells you about.
- What happens to HECS when you die? — the short answer: it's written off.
Why you can trust these numbers
I'm Jack — I live in Melbourne, I paid off my own $34,180 HECS debt over seven years, and I built this site on weekends because nothing else explained HECS in plain English. I don't sell home loans, I don't flog courses, and there's no affiliate link to a big bank anywhere on the site.
Every figure here is cross-checked against the ATO and the Department of Education's Study Assist program. When the rates change — a budget, a new indexation announcement, a fresh threshold — I update the site within 48 hours. Last full review was 18 April 2026. Spot something wrong? Tell me and I'll fix it.
Pay off HECS faster — actionable tactics
Hand-picked strategies Australian graduates actually use. Each one can be implemented this financial year — no gimmicks, no affiliate links.
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01
Chuck a voluntary payment in before 1 June
This one's the big one. Indexation hits on 1 June, and it only applies to whatever is sitting on your balance that day. If you transfer, say, $5,000 in the last week of May, indexation at 3.4% never touches that $5k — so you save around $170 in one go. I did this three years running and it's the single easiest win.
Do this: Grab your PRN from myGov → ATO → Loan Accounts, then BPAY it. Do it 5 business days before 1 June — banks can be slow.
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02
Tick the HECS box on your TFN declaration
Your employer only withholds extra tax for HECS if you tell them you have a debt. I've met grads who got smacked with a $9,000 bill at tax time because they never ticked the box — their payroll had no idea. Getting it withheld from each pay is way less painful than one brutal June invoice.
Do this: Email payroll and say: "Please update my TFN declaration to indicate I have a HELP debt." Sorted next pay cycle.
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03
Add your fringe benefits and super to your income estimate
The ATO uses "repayment income" — not just your salary. It adds back reportable fringe benefits (novated lease is the big one), reportable employer super, net investment losses, and exempt foreign income. A mate of mine on a $95k salary with a $12k novated lease tipped into the 15% bracket and was furious when the letter arrived.
Do this: Check your last payment summary, grab the RFBA number, and add it to your gross before using the calculator.
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04
Don't part-pay your HECS before applying for a home loan
This catches loads of people out. Banks only drop HECS from their serviceability calc when your balance is exactly zero. If you have $25k and pay $20k of it, the bank still assumes the full monthly commitment. Total waste unless you're clearing it completely — and if your balance is under $7–8k you might as well, since clearing it unlocks roughly $160 of borrowing capacity for every $1 of monthly HECS you remove.
Do this: Balance under $8k and you're six months from a home loan? Clear it. Over $15k? Don't touch it — keep the cash for your deposit.
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05
If your investments beat indexation after tax, invest instead
Indexation is capped at the lower of CPI or WPI — roughly 2.5–3.4% heading into 2026. A basic ASX/global ETF returning 7% pre-tax works out at about 4.8% after tax in the 32.5% bracket. Over 10 years, investing $20,000 instead of repaying it early can leave you $4,000–$7,000 ahead. HECS has no interest, just indexation — it's one of the cheapest "debts" you'll ever have.
Do this: Run the numbers yourself in the Voluntary vs Invest calculator using your actual marginal tax rate before you decide.
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06
Don't expect salary sacrifice to shrink your HECS bill
This is the most common bit of dodgy advice I hear. Yes, salary sacrificed super lowers your taxable income — but the ATO adds it back as "reportable super" when working out HECS. Novated leases reduce taxable income too, but they also create a Reportable Fringe Benefit (RFBA) that adds back in. Net effect: salary sacrifice is basically HECS-neutral. Use it for its super-tax benefits, not to dodge HECS.
Do this: If someone tells you salary sacrifice will drop your HECS, ask them to show you the ATO page on repayment income. It won't.
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07
Moving overseas? Tell the ATO within 7 days
Your HECS debt doesn't stay in Australia when you do. If you leave and earn above the AUD threshold ($67,000 for FY2025-26) you're still liable — and you have to lodge a worldwide income declaration each year. Skip it and you cop penalties plus interest. I've seen Aussies come back from London with five years of missed declarations and a $12k penalty bill on top.
Do this: Before you fly, log into myGov → ATO → Update contact details → tell them you're moving. Lodge worldwide income by 31 October each year.
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08
Redirect your tax refund or bonus to HECS in May
Lump-sum cash — your July tax refund, an annual bonus, EOFY commission — is the stuff that vanishes on random takeaway and holidays. If you route half of any big deposit straight to HECS in April or May, you wipe out a year of indexation on that chunk and you never miss the money because it was never in your everyday account.
Do this: Set a rule with yourself: any single deposit over $2,000 in April or May gets split 50/50 — half to HECS via BPAY, half to your offset. Automate it if you can.
Frequently Asked Questions
How is HECS debt repayment calculated in Australia?
What is the current HECS indexation rate for 2026?
Does HECS debt affect my home loan borrowing power?
Should I pay off my HECS debt early?
When does HECS indexation happen each year?
What is the minimum income to start repaying HECS in 2025–26?
Is my HECS debt forgiven if I move overseas?
What happens to HECS debt when you die?
Everything about HECS-HELP — calculators, tips, tactics, rules
Browse the full library. Every page is updated for the FY2025-26 marginal system and the 20% HELP debt cut.