Under the new marginal system (effective 1 July 2025), your HECS repayment depends only on income above $67,000. This table shows the exact compulsory repayment at common salary points — nothing owed below $67,000, then 15c per $1 up to $125,000, 17c up to $179,285, and 10% of whole income above.
HECS repayment at common salaries — FY2025-26 marginal system
Repayment income
Calculation
Annual
Fortnightly
$60,000
Below $67,000 threshold
$0
$0
$65,000
Below $67,000 threshold
$0
$0
$67,000
Threshold
$0
$0
$70,000
15c × $3,000
$450
$17.31
$75,000
15c × $8,000
$1,200
$46.15
$80,000
15c × $13,000
$1,950
$75.00
$85,000
15c × $18,000
$2,700
$103.85
$90,000
15c × $23,000
$3,450
$132.69
$95,000
15c × $28,000
$4,200
$161.54
$100,000
15c × $33,000
$4,950
$190.38
$110,000
15c × $43,000
$6,450
$248.08
$120,000
15c × $53,000
$7,950
$305.77
$125,000
Bracket boundary
$8,700
$334.62
$130,000
$8,700 + 17c × $5,000
$9,550
$367.31
$140,000
$8,700 + 17c × $15,000
$11,250
$432.69
$150,000
$8,700 + 17c × $25,000
$12,950
$498.08
$160,000
$8,700 + 17c × $35,000
$14,650
$563.46
$175,000
$8,700 + 17c × $50,000
$17,200
$661.54
$180,000
10% × $180,000 (top bracket)
$18,000
$692.31
$200,000
10% × $200,000 (top bracket)
$20,000
$769.23
$250,000
10% × $250,000 (top bracket)
$25,000
$961.54
Calculated under the FY2025-26 marginal system (Higher Education Legislation Amendment Act 2025, effective 1 July 2025). Repayment income assumed equal to salary — adjust upward for reportable super, fringe benefits or investment losses. Fortnightly figures divide annual ÷ 26.
How much less is this than the old system?
Under the pre-July-2025 whole-of-income system, the same salaries produced much higher compulsory repayments. The difference widens in the middle:
Salary
Old system (2024-25)
New system (2025-26)
Saving
$70,000
$1,750 (2.5%)
$450
$1,300
$80,000
$3,200 (4.0%)
$1,950
$1,250
$90,000
$4,500 (5.0%)
$3,450
$1,050
$100,000
$5,500 (5.5%)
$4,950
$550
$120,000
$9,000 (7.5%)
$7,950
$1,050
$150,000
$13,500 (9.0%)
$12,950
$550
$200,000
$20,000 (10%)
$20,000
$0
Top-bracket earners ($179,286+) see no change — the new system reverts to 10% whole-of-income above that threshold.
Bracket boundaries matter more than ever
Under the new marginal system, the cliff is at the top bracket ($179,286). Up to $179,285 you are taxed marginally — earning an extra dollar only costs you 17c in HECS. At exactly $179,286 the 10% rate starts applying to your whole income, so crossing that boundary by $1 of repayment income shifts you from owing ~$17,940 (the marginal formula) to $17,929 (10% × $179,286). In practice the cliff is small, but optimising for bracket position is less critical than under the old system.
The main calculator models any income including second-job and investment scenarios.
Tips & Tricks
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.
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.
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.
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.
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.
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.
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.
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.
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
At what salary does HECS start coming out of my pay in 2025-26?
The FY2025-26 compulsory repayment threshold is $67,000 — a lift from the old $54,435 threshold under the previous system. Below $67,000 in repayment income, nothing is withheld for HECS. Above it, 15c for every $1 over $67,000 is your compulsory amount up to $125,000.
How much HECS will I pay on $90,000?
On $90,000 repayment income in FY2025-26, your compulsory HECS repayment is $3,450 per year (15c × $23,000 above the $67,000 threshold). That is approximately $132.69 per fortnight. Under the pre-July-2025 whole-of-income system, the same income would have cost $4,500 (5.0%) — a saving of $1,050.
Is HECS still taken out of a raise?
Yes, but much more gently. Under the new marginal system, a raise from $80,000 to $90,000 adds $1,500 to your annual HECS repayment ($3,450 − $1,950). Under the old system the same raise would have added $2,750 because the rate jumped from 4.0% to 5.0% on the whole income. The old bracket-creep effect has been almost entirely removed except at the very top ($179,286+).
Why does my payslip show different HECS than these numbers?
The table shows annual compulsory repayment. Your employer withholds an estimate each pay using the ATO's 2025-26 withholding schedules, which make assumptions about your annual income based on your current pay cycle. Year-end reconciliation squares the estimate against your actual annual repayment income. Under-withholding is common if you have multiple jobs, variable hours or non-salary income.
Does this include the 20% HELP debt cut?
The repayment amounts in the table are based on the new thresholds only — they do not change based on your loan balance. The 20% cut reduced the balance you owe but does not change the annual compulsory repayment formula. It means you finish paying the debt sooner, not that you pay less each year. See our main calculator for balance projections.