Medicare Levy + MLS calculator
Computes the 2% Medicare Levy and the income-tiered Medicare Levy Surcharge (ITAA 1936 Pt VIIB) — and compares the surcharge against a typical private-hospital premium.
Your situation
Levy + surcharge
Tier 2 — 1.25% MLS rate
MLS income: $130,000.00.
- Medicare Levy (2%)
- $2,600.00
- MLS rate (no PHI)
- 1.3%
- MLS amount (no PHI)
- $1,625.00
- Total ML + MLS if no PHI
- $4,225.00
- Total ML only if you hold PHI
- $2,600.00
The MLS of $1,625.00 is cheaper than the $1,800.00 premium — though insurance buys more than just MLS avoidance.
Frequently asked questions
Who pays the Medicare Levy Surcharge?+
Individuals and families on incomes above the MLS thresholds who do not hold complying private hospital cover for the full year. The surcharge is in addition to the standard 2% Medicare Levy.
Does taking out private health insurance always save money?+
Not always. Compare the MLS you would pay against the after-rebate cost of a basic hospital policy. For singles with income just above the tier-1 floor (≈$93k), a basic policy often costs less than the 1% surcharge. At higher incomes the gap widens further in favour of insurance.
What counts as 'income for MLS purposes'?+
Taxable income plus reportable fringe benefits, reportable super contributions, total net investment losses and exempt foreign employment income. This calculator uses taxable income only as a proxy — refine for high earners with salary packaging.
Not tax, legal or financial advice. Estimates only. Based on Medicare Levy Act 1986 + A New Tax System (Medicare Levy Surcharge — Fringe Benefits) Act 1999.. Tax law changes frequently — confirm current rates with the relevant revenue office and your registered tax agent before relying on these numbers.
MLS amount on the right is driven by the income-tax engine, which currently uses single thresholds. Family-threshold tier badge above reflects your filing status. Lifetime Health Cover loading and the income-tested PHI rebate are not modelled.