Changes to Medicare Levy Surcharge

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Changes to Medicare Levy Surcharge

Are you?	- A taxpayer without private patient hospital insurance?
At a glance:	- There have been some changes to the method of calculating income for the purposes of the 1% Medicare Levy Surcharge.
You should:	- Be aware of how the changes to the Medicare Levy Surcharge may affect you. - Contact us if you require any clarification or advice.

1.	The Medicare Levy Surcharge is an additional 1% levy on taxable income imposed on "high income" taxpayers who do not have adequate private patient hospital cover for themselves and their dependants. (Click here for more information).
2.	Currently, the Medicare levy surcharge thresholds applicable to both individuals and families are as follows: a. $70,000 for individuals; and b. $140,000 for families [adjusted for the number of dependant children].
3.	From July 1, 2009, the method of calculation of income for Medicare Levy Surcharge purposes has changed.
4.	Income for Medicare Levy Surcharge purposes will now be calculated by adding the following items to a taxpayers modified taxable income: - Reportable fringe benefits [as disclosed on the taxpayers PAYG payment summary]; - Total net investment losses from rental properties and financial assets; and - Reportable superannuation contributions.
5.	Low income earners with income above the Medicare Levy thresholds as well as high income earners who have adequate private health insurance cover will continue to only pay the 1.5% Medicare levy.