How much HECS will you repay in 2026–27? The new thresholds in dollars

HECS-HELP and other study loans are repaid through the tax system once your income passes a threshold. From the 2025–26 income year the rules changed. Repayments are now worked out only on the income above the threshold, not on your whole income. This guide shows what that means in dollars for 2026–27, and two things that catch people out.

The 2026–27 thresholds

The ATO publishes the thresholds each year. For 2026–27 they are:

Under the old system, crossing the threshold meant a percentage of your whole income. Now the first $69,528 is never counted. Someone with $80,000 of repayment income pays 15% of the $10,472 above the threshold, which is $1,571 for the year, or about $60 a fortnight.

What it costs at different incomes

The table compares the 2025–26 and 2026–27 years. The thresholds rose for 2026–27, so the same income means a smaller repayment.

For any income from $69,529 to $125,000, the 2026–27 repayment is $379 a year lower than in 2025–26. At $200,000 and above nothing changes, because the 10% rate on total income still applies there.

Catch one: repayment income is not taxable income

The thresholds apply to repayment income, which the ATO defines more widely than taxable income. It adds back:

• reportable fringe benefits
• total net investment losses, including net rental losses
• reportable super contributions, which include salary sacrifice
• exempt foreign employment income

So strategies that lower taxable income don't always lower the study loan repayment. Take someone on a $90,000 salary who sacrifices $10,000 into super. After the $1,000 standard deduction for work-related expenses, their taxable income is $79,000, but the sacrifice is added back, so their repayment income is $89,000. Their 2026–27 repayment is $2,921, not the $1,421 it would be on $79,000. A rental property running at a loss works the same way. The tax saving on the sacrifice itself is covered in salary sacrifice into super.

Catch two: what your employer withholds

If you tell your employer you have a study loan, they withhold extra from each pay using the ATO's tables. The amount is an estimate. The real repayment is worked out when you lodge your tax return, based on your repayment income for the whole year. If too much was withheld, the extra comes back as part of your refund. If too little was withheld, for example because you had two jobs or rental losses, you may get a bill.

Indexation still applies

On 1 June each year, the part of the loan that has been unpaid for more than 11 months is indexed. The rate is the lower of CPI and wage growth. On 1 June 2026 it was 2.8%, after 3.2% in 2025. On a $30,000 balance, 2.8% adds $840.

This matters most for people earning under the threshold. With no compulsory repayment, the balance grows each June unless voluntary repayments are made. Study loans don't charge interest beyond indexation, which is one reason the trade-off between extra repayments and other uses of the money differs from a home loan. For that wider question see pay off the mortgage or invest.

Debts that existed on 1 June 2025 were also cut by 20% under a one-off reduction. The ATO has finished applying it, so it shows in current balances.

Assumptions behind the numbers

• Thresholds and rates are the ATO's published figures for 2025–26 and 2026–27.
• Amounts are compulsory repayments for a full income year, rounded to the nearest dollar. The fortnightly figure is the annual amount divided by 26.
• Tables are by repayment income. Examples treat salary as the only income. From 2026–27 repayment income starts from taxable income, which for an employee is salary less the $1,000 standard deduction for work-related expenses.
• The indexation example assumes the whole $30,000 has been owed for over 11 months.
• Figures don't include income tax, the Medicare levy or any tax offsets. Your own position may differ, and the ATO or a registered tax agent can confirm it.