HECS Repayment Brackets 2025-26: Rates, Thresholds & How to Pay
25 June 2026 · 7 min read · General information only
What’s changing for HECS in 2025-26?
From 1 July 2025, the compulsory repayment thresholds and rates for HECS-HELP loans are indexed. The minimum repayment threshold rises to $54,435 (up from $51,550 in 2024-25). If your income is below this, you don’t need to make any compulsory repayments.
Repayment rates still start at 1% of your repayment income once you cross the threshold, and increase in bands up to 10% for incomes over $161,115.
Here’s the full repayment table for 2025-26:
| Repayment income bracket | Repayment rate (% of income) |
|---|---|
| Below $54,435 | 0% |
| $54,435 – $60,479 | 1% |
| $60,480 – $66,599 | 2% |
| $66,600 – $72,839 | 2.5% |
| $72,840 – $79,199 | 3% |
| $79,200 – $85,679 | 3.5% |
| $85,680 – $92,279 | 4% |
| $92,280 – $98,999 | 4.5% |
| $99,000 – $105,839 | 5% |
| $105,840 – $112,799 | 5.5% |
| $112,800 – $119,879 | 6% |
| $119,880 – $127,079 | 6.5% |
| $127,080 – $134,399 | 7% |
| $134,400 – $141,839 | 7.5% |
| $141,840 – $149,399 | 8% |
| $149,400 – $157,079 | 8.5% |
| $157,080 – $164,999 | 9% |
| $165,000 – $172,999 | 9.5% |
| $173,000+ | 10% |
Your repayment income is your taxable income plus any reportable fringe benefits and total net investment losses. This is what the ATO uses to calculate your compulsory repayment.
How can you check your HECS debt and repayments?
Your HECS balance is visible through your myGov account linked to the ATO. You’ll also see any compulsory repayments deducted from your pay on your annual tax notice of assessment.
If you’re employed, your employer may withhold extra tax to cover your compulsory repayment. You can check this on your payslip – look for a HELP (or SFSS) deduction line. If you’re self-employed, you pay the amount when you lodge your tax return.
Use our HECS repayment calculator to see exactly what your compulsory repayment will be for 2025-26 based on your estimated income.
Should you make voluntary repayments?
Voluntary repayments reduce your debt balance, which means less indexation applied each year. Indexation is applied on 1 June each year, based on the CPI (Consumer Price Index). In recent years, indexation has been high – over 7% in 2023 – but for 2025 it’s expected to be lower, around 3-4%.
Consider making a voluntary repayment if:
- You have a high income and want to reduce future indexation.
- You’re close to paying off your debt and want to avoid another year of indexation.
- You receive a bonus or windfall and can afford to pay extra without affecting your emergency savings.
However, voluntary repayments are permanent – you can’t get the money back if you change your mind later. Also, interest on HECS is tied to inflation, not commercial rates, so it’s often cheaper than a personal loan or credit card debt.
What happens if you don’t pay?
Compulsory repayments are mandatory if your income is above the threshold. If you don’t pay through your employer’s withholding, you’ll owe the amount when you lodge your tax return. If you don’t pay by the due date, the ATO can charge the general interest charge (GIC) on the unpaid amount.
If you’re overseas for more than 183 days in a year, you must still make repayments if your worldwide income exceeds the threshold. The ATO tracks this and can apply penalties.
Tips to manage your HECS debt
- Know your repayment income – Check your taxable income plus any fringe benefits and investment losses.
- Use the HECS repayment calculator – Work out your estimated repayment before you lodge your tax return so you’re not caught off guard.
- Consider salary packaging – If your employer offers it, you can salary sacrifice into super, which reduces your repayment income.
- Pay voluntary amounts before 1 June – This reduces the debt that gets indexed on 1 June.
- Don’t overpay – If you’re close to paying off your debt, make sure you don’t overpay. The ATO will refund any excess, but it’s simpler to get it right.
This is general information only, not financial advice.