Private Health Insurance Rebate Calculator Australia

What the private health insurance rebate calculator does

The private health insurance rebate calculator works out how much of your health cover the Australian Government pays for, and what the policy costs you once that contribution is applied. You enter the annual premium, your income for surcharge purposes, whether you are tested as a single or a family, the age of the oldest person covered, and, if they apply, the number of dependent children and any Lifetime Health Cover loading. The tool returns the rebate percentage, the rebate in dollars, the income tier you fall into, how much income is left before the next tier, the premium after the rebate, and what the rebate would have been at the base tier.

The rebate is worth having. At the base tier it covers roughly a quarter of the premium, and for members aged 70 or over it covers close to a third. Because it is means tested against a measure that is broader than taxable income, plenty of people receive less than they expect, and some receive nothing at all.

The two tests that set your rate

Two facts about your household set the rebate percentage, and nothing else does.

The first is income. Four tiers apply: a base tier, then tiers one, two and three. Singles and families have separate thresholds, and the family thresholds are roughly double the singles thresholds. Once income for surcharge purposes passes the top of the base tier the rebate steps down, and above the tier two ceiling it disappears entirely. The thresholds are indexed on 1 July each year, so a threshold that applied last financial year may not apply this one.

The second is age. The rate is set in three bands, based on the age of the oldest person covered: under 65, 65 to 69, and 70 or over. Each band up adds roughly four percentage points at every income tier, so a couple's rebate can rise the year one of them turns 65 even though nothing about their income has changed.

The rebate percentages themselves are adjusted every 1 April, in line with a formula that compares premium growth with the consumer price index. That adjustment usually reduces the percentage slightly, which is why the rebate rate on your April statement rarely matches the one on your statement from the previous year.

Income for surcharge purposes

The measure used is not taxable income. Income for surcharge purposes adds reportable fringe benefits, reportable employer superannuation contributions such as salary sacrifice, net investment losses including negatively geared property, and exempt foreign employment income. For anyone salary sacrificing into super or holding a geared investment, that can be several thousand dollars above the figure on their tax return, and it is the reason a rebate claimed during the year sometimes has to be paid back at lodgement.

Families are tested on combined income. Couples, de facto partners, single parents and families are all tested against the family thresholds, and those thresholds rise by a fixed amount for each dependent child after the first. Enter your children in the advanced options and the tool applies that lift before it selects your tier.

Claiming it, and what happens if you get it wrong

You can take the rebate in one of two ways, and the total is the same either way. Most people nominate a tier with their fund and receive a reduced premium each month. The alternative is to pay the full premium and claim the rebate as a refundable tax offset when you lodge.

The difference matters when your income changes. If you nominate a tier that turns out to be too generous, the Australian Taxation Office recovers the difference at lodgement, and a mid-year pay rise or a bonus is enough to trigger that. If you nominate a lower tier than you end up needing, the shortfall is refunded to you instead. The headroom figure in the result exists for this reason: it shows how much more income you can earn before the next tier applies, which is the number to watch when a pay rise or a capital gain is coming.

Reading the result

On a A$2,400 premium with A$95,000 of income for surcharge purposes, a single under 65 sits in the base tier and receives a rebate of about A$579, leaving roughly A$1,821 to pay. Push the same person to A$125,000 and they drop to tier two, where the rebate is about A$193, a A$386 increase in the cost of the identical policy caused entirely by the income test.

The donut shows the split between the government's share and yours, and the rebate-lost figure quantifies exactly what the income test has cost you compared with the base tier. If a Lifetime Health Cover loading applies, it is added after the rebate, because no part of a loading is rebated.

When to use this tool

Use it before you nominate a rebate tier with a new fund, when your income changes enough to move you between tiers, in the year the oldest person on the policy turns 65 or 70, and when you are deciding whether keeping hospital cover still makes sense against the Medicare Levy Surcharge. The output is an estimate based on the rates and thresholds stored in the tool and the figures you enter: your fund applies the rebate to its own premiums and the ATO reconciles it at lodgement, so confirm the final position with your insurer or a registered tax agent.

This is general information only and not financial advice.

About This Tool: Private Health Insurance Rebate

Private health insurance rebate: use this tool to get an instant, accurate estimate. The figures follow official ATO guidance and every rate and threshold is kept up to date for 2026. Adjust the inputs above to match your situation, or browse all our calculators to plan your next step.