Medicare levy, 2026-27
Medicare levy and surcharge
How much Medicare levy you pay, the low-income thresholds, and when the Medicare levy surcharge applies if you don't have private hospital cover.
The Medicare levy is 2% of taxable income
Australian residents pay a Medicare levy of 2% of taxable income on top of income tax. Foreign residents do not pay it. Employers include it in the tax withheld from each pay. ATO: Tax rates, Australian residents; ATO: Schedule 1 coefficients for weekly payments.
Lower incomes pay less or none
A single person pays no levy if taxable income is at or below the lower threshold. Above it, up to and including the upper threshold, the levy is reduced to 10c for each $1 above the lower threshold (never more than 2% of taxable income); above the upper threshold it is the full 2%. Taxable income here is after deductions, including the $1,000 standard deduction for work-related expenses.
| Taxable income (single) | Levy | Medicare levy |
|---|---|---|
| $25,000 | Nil | $0.00 |
| $28,011 | Nil | $0.00 |
| $30,000 | Reduced | $198.90 |
| $33,000 | Reduced | $498.90 |
| $35,013 | Reduced | $700.20 |
| $35,014 | 2% | $700.28 |
| $50,000 | 2% | $1,000.00 |
| $80,000 | 2% | $1,600.00 |
| $120,000 | 2% | $2,400.00 |
| Who | No levy up to | Reduced levy up to |
|---|---|---|
| Single | $28,011 | $35,013 |
| Family | $47,238 | $59,047 |
| Family, for each dependent child, add | $4,338 | $5,423 |
| Single, entitled to the seniors and pensioners tax offset | $44,268 | $55,335 |
| Family, entitled to the seniors and pensioners tax offset | $61,623 | $77,028 |
These are the thresholds the ATO publishes for 2025-26, which it also uses in its 2026-27 withholding tables. They are the latest available: the 2026-27 thresholds have not been published and may be higher. The 2025-26 figures, a 2.9% rise, were announced in the May 2026 Budget and are on ATO pages; we have not found the law that sets them, and the last amounts we could confirm in legislation are lower ($27,222 for a single person). Sources: ATO: Medicare levy reduction for low-income earners; ATO: Medicare levy reduction, family income; Budget 2026-27, Budget Paper No. 2.
The surcharge applies above $105,000 without hospital cover
If you don't have appropriate private patient hospital cover, you pay the Medicare levy surcharge once your income for surcharge purposes is above the threshold for your tier. Income for surcharge purposes is your taxable income plus reportable fringe benefits, total net investment losses and reportable super contributions, such as salary sacrifice. The rate for your tier is charged on your taxable income and reportable fringe benefits. ATO: Medicare levy surcharge income, thresholds and rates.
| Single income, 2026-27 | Surcharge |
|---|---|
| $105,000 or less | Nil |
| $105,001 to $123,000 | 1% |
| $123,001 to $164,000 | 1.25% |
| $164,001 and over | 1.5% |
| Family income, 2026-27 | Surcharge |
|---|---|
| $210,000 or less | Nil |
| $210,001 to $246,000 | 1% |
| $246,001 to $328,000 | 1.25% |
| $328,001 and over | 1.5% |
The family threshold rises by $1,500 for each dependent child after the first. In 2025-26 the single tiers started at $101,000, $118,000 and $158,000.
| Salary (single, no cover) | Surcharge rate | Surcharge | Take-home a year |
|---|---|---|---|
| $110,000 | 1% | $1,090.00 | $83,510.00 |
| $130,000 | 1.25% | $1,612.50 | $96,587.50 |
| $150,000 | 1.25% | $1,862.50 | $108,957.50 |
| $200,000 | 1.5% | $2,985.00 | $137,615.00 |
The surcharge isn't taken from your pay
The standard PAYG withholding scales don't include the surcharge, so it is charged when you lodge your tax return, unless you ask your employer to withhold more. Why your payslip differs.
Work out your take-home pay, ticking "No private hospital cover" to include the surcharge.
These figures are estimates based on the information you entered and the 2026-27 rates and thresholds published by the Australian Taxation Office, with the Medicare levy low-income thresholds for 2025-26, the latest published. They are general information, not tax, financial or legal advice. Your actual pay and tax can differ, for example because of other income, deductions, your family situation, allowances, salary packaging or how your employer runs payroll. Check your payslip, or ask your employer, a registered tax agent or the ATO, before relying on them.