2026–27 HECS-HELP repayment thresholds
Since 2025–26, compulsory repayments are marginal — you repay a percentage of your repayment income above the threshold, not of your whole income. That replaced the old system of 18 bands that applied a single rate to your entire income.
| Repayment income | Compulsory repayment |
|---|
| $0 – $69,528 | Nil |
| $69,529 – $129,717 | 15c for each $1 over $69,528 |
| $129,718 – $186,050 | $9,028 plus 17c for each $1 over $129,717 |
| $186,051 and over | 10% of total repayment income |
Examples: $80,000 → $1,571 a year; $100,000 → $4,571; $150,000 → $12,476. Thresholds are indexed every 1 July.
Frequently asked questions — HECS/HELP
What is the HECS-HELP repayment threshold for 2025–26 and 2026–27?
The threshold was $67,000 in 2025–26 and is $69,528 in 2026–27. At or below the threshold, no compulsory repayment is due. Above it, repayments are marginal: 15c for each $1 over $69,528, then $9,028 plus 17c for each $1 over $129,717, and 10% of total repayment income above $186,050 (2026–27 figures from the ATO).
How is HECS-HELP debt indexed?
HECS-HELP debt is indexed on 1 June each year at the lower of CPI and the Wage Price Index. The rate was 2.8% in 2026, 3.2% in 2025 and 4.0% in 2024. If your compulsory repayments are less than the indexation applied, your debt can grow despite making payments.
Does HECS-HELP affect my borrowing capacity for a home loan?
Yes — Australian lenders include your compulsory HECS-HELP repayment in their serviceability calculations as a reduction in net income. For example, at $90,000 income the 2026–27 compulsory repayment is $3,071 a year, which lenders deduct from your income when assessing serviceability. This can reduce your borrowing capacity by $50,000–$80,000 depending on the lender.
Should I make voluntary HECS-HELP repayments?
It depends on your situation. Voluntary repayments make sense when: (1) indexation is higher than the after-tax return you'd earn on savings; (2) you need to maximise your home loan borrowing capacity; (3) you want to eliminate the psychological stress of the debt. However, unlike credit card debt, HECS-HELP is 0% interest (only CPI indexed), so it's not always the optimal use of spare cash if you have higher-rate debt or investment opportunities.
How is HECS-HELP repayment calculated?
Since 2025–26, repayments are marginal — calculated only on repayment income above the threshold (repayment income is broadly taxable income plus reportable fringe benefits, reportable super contributions and net investment losses). In 2026–27 that is 15c per $1 over $69,528 up to $129,717, then 17c per $1, and 10% of total income above $186,050. Your employer withholds the amount from your pay if you declare your HECS debt on your TFN declaration.