What Is The Minimum Repayment Threshold For Help Debt 2023?
Higher Education Loan Program (HELP) debt is a type of loan for Australian citizens and permanent residents who have studied at an eligible Australian tertiary institution. The HELP debt has been in existence since 1989 and since then, the government has continually reviewed and amended the repayment thresholds, which are used to determine when a person needs to begin repaying their HELP debt. In 2023, the Australian Government has set a minimum repayment threshold for HELP debt.
What Is The Minimum Repayment Threshold For HELP Debt 2023?
The minimum repayment threshold for HELP debt in 2023 is $45,881. This means that if you earn more than this amount in a financial year, then you will need to start repaying your HELP debt. The repayment rate is set at four percent of your income above the threshold. So, if you earn $50,000 in 2023, you will need to start repaying your HELP debt as your income is above the threshold and your repayment rate will be four percent of $4,119 ($50,000 - $45,881).
How Is The Repayment Threshold Calculated?
The repayment threshold is calculated in relation to the average weekly ordinary time earnings (AWOTE) for full-time adult employees in the preceding financial year. This means that the repayment threshold is adjusted each year based on the average AWOTE of the previous financial year. So, the repayment threshold for 2023 is based on the AWOTE of the financial year 2022.
What Are Other Repayment Thresholds?
In addition to the minimum repayment threshold for HELP debt, there are other repayment thresholds for other types of HELP debt. These include the repayment threshold for Student Start-up Loan (SSL) and Student Services and Amenities Fee (SSAF) debt which is set at $51,309 for 2023, the repayment threshold for Trade Support Loan (TSL) debt which is set at $54,126 for 2023, and the repayment threshold for VET Student Loan (VSL) debt which is set at $54,869 for 2023.
What Happens If You Don't Repay Your HELP Debt?
If you don't repay your HELP debt, then the Australian Taxation Office (ATO) will take action to recover the debt. This could include issuing you with a debt notice, garnishing your wages or bank account, or taking legal action. Additionally, if you don't pay your HELP debt, then you may be ineligible for the Australian Government's future study assistance programs and the ATO may withhold your tax refund.
How Can You Repay Your HELP Debt?
The best way to repay your HELP debt is by making regular payments. You can do this by setting up a direct debit from your bank account, or by making regular payments to the ATO. You can also make lump sum payments, or you can make voluntary payments to reduce the amount of interest you are charged.
How Can You Calculate Your HELP Debt Repayment?
The ATO provides a repayment calculator that you can use to calculate your HELP debt repayments. This calculator takes into account your income and the repayment thresholds, and it can help you to work out how much you need to pay each year. Additionally, the calculator can help you to work out how long it will take you to pay off your debt.
Conclusion
The minimum repayment threshold for HELP debt in 2023 is $45,881. If you earn more than this amount in a financial year, then you will need to start repaying your HELP debt. The repayment rate is set at four percent of your income above the threshold. Additionally, there are other repayment thresholds for other types of HELP debt. If you don't repay your HELP debt, then the ATO will take action to recover the debt. The best way to repay your HELP debt is by making regular payments or lump sum payments. You can also use the ATO's repayment calculator to calculate your HELP debt repayments.