Medicare Levy · Calculator

Medicare Levy & MLS Calculator Australia

Work out how much you'll pay in Medicare Levy and whether you're liable for the Medicare Levy Surcharge. The levy is generally up to 2%, with an individual low-income reduction; MLS is an additional charge for higher earners without private hospital cover.

2% Medicare Levy1%–1.5% MLSSingles & Families
01 —INPUTS

2026-27 Medicare levy and Medicare Levy Surcharge settings

02 —RESULTS
Awaiting input

Enter your taxable income to calculate Medicare Levy

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Levy vs surcharge

Understanding Medicare Levy vs MLS

Medicare Levy (2%)

A tax paid by most Australian residents to fund the public healthcare system. It applies regardless of whether you use public or private healthcare.

Medicare Levy Surcharge (1–1.5%)

An additional tax that only applies to higher-income earners who do not have eligible private hospital insurance. Designed to encourage higher earners to take out private cover.

The key difference: you can avoid the MLS by having private hospital cover, but the Medicare Levy applies to almost everyone (with some low-income exemptions).

Threshold reference

Medicare Levy Surcharge thresholds and rates for 2026-27

The surcharge is charged on income for MLS purposes, not taxable income alone, and the rate steps up in four bands. Couples, de facto partners, single parents and families are assessed on combined income against the family column.

TierSinglesFamiliesMLS rate
Base tier Up to $105,000 Up to $210,000 Nil
Tier 1 $105,001 – $123,000 $210,001 – $246,000 1%
Tier 2 $123,001 – $164,000 $246,001 – $328,000 1.25%
Tier 3 $164,001 and above $328,001 and above 1.5%
→ The family threshold rises by $1,500 for each dependent child after the first — two children lift the base family threshold from $210,000 to $211,500.
→ In 2025-26 the single bands were $101,000 / $118,000 / $158,000 and the family base threshold was $202,000. Switch the year in the calculator above to price a prior-year return.
→ Crossing a band changes the rate on your whole MLS income, not just the excess — unlike income tax brackets, there is no marginal step-up.
→ The surcharge is worked out per adult on that adult's own MLS income, but the rate comes from the combined family figure.

Single on $110,000

$1,100

1% × $110,000 · surcharge for a full year with no hospital cover

Single on $130,000

$1,625

1.25% × $130,000 · surcharge for a full year with no hospital cover

Single on $175,000

$2,625

1.5% × $175,000 · surcharge for a full year with no hospital cover

Levy arithmetic

How much Medicare levy will you actually pay?

The headline rate is 2% of taxable income, but there are three zones, not one. Below the lower threshold the levy is nil. Between the two thresholds it phases in at 10 cents per dollar of the amount above the lower threshold — which is why someone on $32,000 pays far less than 2%. Above the upper threshold the flat rate applies to the whole taxable income.

Taxable incomeMedicare levyEffective rateWhy
$26,000 $0 0.00% Below the lower threshold — no levy
$32,000 $399 1.25% Shade-in: 10c per $1 over $28,011
$45,000 $900 2.00% Full rate: 2% of taxable income
$90,000 $1,800 2.00% Full rate: 2% of taxable income
$150,000 $3,000 2.00% Full rate: 2% of taxable income

Single low-income thresholds: no levy up to $28,011, phasing to the full rate at $35,013. Families start at $47,238 (full rate from $59,047), plus $4,338 on the lower threshold for each dependent child. Seniors and pensioners eligible for SAPTO get a higher set again: $44,268 to $55,335 for a single.

The levy and the surcharge stack: a single on $175,000 with no hospital cover pays 2% levy plus the 1.5% surcharge. Model your own figures in the calculator above, or use the Medicare Levy Reduction Calculator for the SAPTO and family-income variants.

Rebate vs surcharge

Private health rebate tiers sit on the same income bands

The four income bands that set your MLS rate also set your private health insurance rebate — so the tier that makes the surcharge more expensive simultaneously makes cover more expensive. The rebate percentages below apply to premiums paid from 1 April 2026 to 31 March 2027.

TierMLS rateRebate under 65Rebate 65–69Rebate 70+
Base tier Nil 24.118% 28.139% 32.158%
Tier 1 1% 16.079% 20.098% 24.118%
Tier 2 1.25% 8.038% 12.058% 16.079%
Tier 3 1.5% 0.000% 0.000% 0.000%

The two dates that catch people out: rebate percentages are re-set every 1 April by the rebate adjustment factor, while the income bands move on 1 July with the MLS thresholds. A financial year therefore straddles two rebate percentages, and 1 April to 30 June is priced on the previous year's income bands.

Reading the break-even. Buying hospital cover is only cheaper than the surcharge when the premium after the rebate above is less than your surcharge. A single on $130,000 faces $1,625 of MLS and sits in tier 2, so the rebate on their premium is 8.038% under age 65 — the comparison is against the rebated premium, never the sticker price. Work the full sum on the private health vs MLS break-even page, and check the Lifetime Health Cover loading if you are over 31 and taking out cover for the first time.

What's included / excluded

Calculator scope

Included

→ Individual low-income Medicare levy reduction
→ Family-income Medicare levy reduction
→ MLS based on income thresholds
→ Single thresholds: $105k / $123k / $164k
→ Family base threshold: $210k + $1,500 after the first child
→ Separate MLS calculation per adult
→ Reportable fringe benefits and tier-only MLS additions
→ Individual low-income MLS exemption within a family
→ Potential savings if you take out cover

Not included

– Partial-year insurance coverage
– One spouse covered, one not
– Dependent children income
– Medicare Levy exemptions (certain visas)
– Exempt foreign employment and section 98 trust income
– Private health insurance rebate

The main calculator includes both the individual low-income reduction and the family-income reduction. The latest ATO-published low-income thresholds are for 2025-26; this page carries those official values into the 2026-27 planning estimate until the ATO publishes the next set. For SAPTO and more detailed circumstances, use our Medicare Levy Reduction Calculator.

Private health decision guides

Should you buy cover?

If your next question is not just "how much MLS will I pay?" but "should I buy cover?", these guides break the decision into the main moving parts:

Private health vs MLS

Use a break-even comparison before deciding that hospital cover is worth buying.

Is private health insurance worth it?

Use MLS, rebate, and premium logic together in one decision framework.

Private health rebate guide

Move from sticker premium to net premium before comparing against MLS.

LHC loading guide

Check whether delayed cover makes your premium materially more expensive.

Family MLS thresholds

See how spouse income and dependant children change the household decision.
Next step if still unsure

Check the rule that most often changes the outcome

Unsure whether your policy actually avoids MLS?

Check the hospital-cover rule, excess limits, and why extras-only cover can still leave you paying the surcharge.

Read the MLS cover explainer →

Income near the levy threshold?

See when the low-income reduction means the standard 2% Medicare levy estimate is too high.

Read the levy reduction explainer →
FAQ
What is the Medicare Levy?
The Medicare Levy is generally up to 2% of taxable income and helps fund Australia's public healthcare system. Low-income earners may be exempt or pay a reduced rate. This calculator includes the individual low-income reduction.
Who is exempt from the Medicare levy?
ATO exemption categories include certain medical circumstances, qualifying foreign residents and people who were not entitled to Medicare benefits. An exemption can apply for all or only some days of the year and dependant circumstances can affect it. Low income is a separate exemption or reduction pathway. This calculator can model entered exemption days but cannot decide whether you satisfy the legal category or evidence requirements.
What is the Medicare Levy Surcharge (MLS)?
The Medicare Levy Surcharge is an additional tax of 1% to 1.5% that applies to higher-income earners who do not have eligible private hospital insurance. For singles, the base threshold is $105,000 in 2026-27.
Do I need to pay the MLS?
You may need to pay MLS if your income for MLS purposes exceeds $105,000 as a single and you do not have eligible hospital cover. For 2026-27, the single tiers are 1% to $123,000, 1.25% to $164,000, then 1.5%.
What counts as eligible private health insurance?
To avoid the MLS, you need a private hospital insurance policy with an excess of $750 or less for singles ($1,500 for families). Extras-only cover or general treatment policies do not count — you specifically need hospital cover. The policy must be held for the full financial year to get the full exemption.
Is the MLS worth avoiding with private health insurance?
It depends on your MLS liability, the net premium and the cover itself. Compare the calculator's estimated MLS with the annual hospital premium after any private health insurance rebate. Do not assume cover is cheaper purely because your taxable income is high: the MLS tier uses income for MLS purposes and the policy must cover you and all relevant dependants for the applicable days.
What is the family MLS threshold?
The base family MLS threshold for 2026-27 is $210,000. It increases by $1,500 for each dependent child after the first.
How is MLS calculated for families?
The MLS rate is determined by combined family income for MLS purposes, but the surcharge is calculated separately for each adult. The rate applies to that adult's taxable income, reportable fringe benefits and any income on which family trust distribution tax was paid. A family member whose own MLS income is at or below the individual low-income threshold does not pay MLS.
What is income for MLS purposes?
ATO income for MLS purposes starts with taxable income and adds reportable fringe benefits, total net investment losses, reportable super contributions and certain trust or exempt foreign employment amounts. Some additions determine the tier without forming part of the amount charged. This calculator separately collects surcharge-base additions and tier-only additions.
How much is the Medicare levy on my income?
The levy is 2% of taxable income once you are above the upper low-income threshold of $35,013 (single). Below $28,011 you pay nothing; in between, the levy phases in at 10 cents per dollar of the amount over $28,011. So $32,000 of taxable income attracts about $399, while $90,000 attracts $1,800.
Is the surcharge charged only on income above the threshold?
No — and this is the most common misunderstanding. Unlike income tax brackets, the MLS rate for your tier applies to your entire income for MLS purposes. Crossing a tier boundary by one dollar re-prices the whole amount, which is why the surcharge can jump by hundreds of dollars for a small pay rise.
What are the MLS income thresholds for 2026-27?
Singles: nil up to $105,000, 1% to $123,000, 1.25% to $164,000, then 1.5%. Families: nil up to $210,000, 1% to $246,000, 1.25% to $328,000, then 1.5%, with the family thresholds rising $1,500 for each dependent child after the first.
How much private health insurance rebate do I get at my income?
The rebate uses the same four income bands as the MLS. For premiums paid between 1 April 2026 and 31 March 2027 and a policyholder under 65, the rebate is 24.118% in the base tier, 16.079% in tier 1, 8.038% in tier 2 and nil in tier 3. It is higher at ages 65–69 and higher again from 70. Rebate percentages re-set each 1 April; the income bands move each 1 July.
Are these calculations updated for 2026-27?
Yes. The default uses 2026-27 Medicare and MLS settings, and you can switch to 2025-26 in the calculator.

Tax Accuracy & Sources

Reviewed: 17 July 2026 · Tax year: 2026-27

Estimates Medicare levy (including individual and family low-income reductions) and MLS from taxable income, family details and optional MLS income additions. The 2026-27 MLS tiers are official. The Medicare low-income reduction carries the latest ATO-published 2025-26 thresholds until the next annual thresholds are published. It excludes partial-year cover, SAPTO eligibility, exempt foreign employment and section 98 trust income.

Related calculators

Medicare Levy Reduction Calculator Low income Medicare levy shade-in reduction Medicare Levy Exemption Checker Check ATO exemption categories, MES evidence and full or half exemption days MLS Thresholds 2026-27 ATO Medicare levy surcharge income tiers for 2026-27 — singles from $105,000, families from $210,000, charged at 1% to 1.5% MLS Thresholds 2025-26 Prior-year ATO Medicare levy surcharge tiers for returns being lodged now — singles from $101,000, families from $202,000 MLS Family Thresholds How the family MLS threshold is built — $210,000 base plus $1,500 for each dependent child after the first Medicare Levy Thresholds 2026-27 Where the 2% Medicare levy starts and phases in for 2026-27 — $28,011 single, $47,238 family, with the senior and pensioner thresholds
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