NCA Blog

HECS HELP Debt Benefit

NCA – 31-Oct-2018

The Government announced in the 2017 Federal Budget that the HECS-HELP Benefit will be removed effective 1 July 2017, meaning the 2017 financial year will be the final year in which eligible taxpayers can claim this incentive. However, you have until 30 June 2019 to lodge your application.


What is the HECS-HELP Benefit?

The HECS-HELP benefit was a government initiative introduced to encourage graduates of particular courses to take up related occupations by reducing their compulsory HELP repayments or their HELP debt. Effectively, you can receive a cheque back from the Government for part of the HELP debt you have repaid in your tax return.

Who is eligible?

You are eligible for the HECS-HELP Benefit if you have graduated in one of the following fields:

  • Mathematics, statistics or science (after 30 June 2008)
  • Education, nursing or midwifery (after 30 June 2009)
  • Early childhood education (after 30 June 2009)

And you satisfy the following criteria:

  1. You were a Commonwealth supported student for some, or all, of that course
  2. You were employed in an eligible occupation (see section at end of this article) in Australia related to that course for at least one week during the financial year
  3. You incurred a HELP debt at course completion in respect of that course and still have some or all of that HELP debt to repay
  4. You have a HELP debt in the relevant financial year
  5. You are required to make a compulsory HELP repayment in the financial year for which you are applying (taxable income exceeding $54,868 in the 2017 financial year)

How much will the reduction be?

The maximum annual HECS-HELP Benefit amounts are as follows:

Income year Early childhood education teachers Math’s or science graduates Education and nursing (including midwifery) graduates.
2016-17 $1,947.17 $1,825.46 $1,825.46

 

And the Benefit will be calculated on a pro-rata basis according to the number of weeks worked in the financial year.

Example

Jennifer completed an eligible nursing degree in July 2016 and worked as a registered nurse from August 2016 to June 2017 for a period of 47 employed weeks in the 2017 financial year.  Jennifer incurred a HECS-HELP debt of $10,000 upon completion of her nursing degree.  Jennifer lodges her 2017 tax return in August 2017 and applies for the HECS-HELP Benefit at the same time.  Her repayment income (taxable income for HECS-HELP Debt repayments) was $60,000, resulting in a compulsory HECS-HELP Debt repayment of $2,400 (4%).

HECS-HELP Benefit amount         = Maximum benefit / 52 x weeks employed

= $1,825.46 / 52 weeks x 47 weeks

= $1,649.94

Jennifer’s accumulated HECS-HELP Debt is reduced by $1,649.94, meaning she will be required to make a personal HECS-HELP Debt repayment of only $750.06 ($2,400.00 less $1,649.94).

How to apply?

The application forms are available via the ATO website.  See link below:

https://www.ato.gov.au/Forms/HECS-HELP-benefit—Overview/?page=1#Lodging_your_application

And the forms must be lodged with the ATO prior to:

Income year for which you are claiming the HECS-HELP benefit Applications must be lodged with the ATO by
2016-17 income year 30 June 2019

 

Should you have any queries regarding the HECS-HELP Benefit, please don’t hesitate to contact us here.

Eligible Occupations?

Maths or science graduates:

  • Actuary
  • Agriculture scientist
  • Agronomist
  • Biochemist
  • Biologist
  • Biophysicist
  • Botanist
  • Chemist (not dispensing pharmacist)
  • Chemistry technician
  • Ecologist
  • Environmental scientist
  • Forester
  • Geologist
  • Geophysicist
  • Laboratory assistant
  • Laboratory technician
  • Life scientist
  • Mathematician
  • Medical laboratory scientist
  • Medical physicist
  • Medical technician
  • Metallurgist
  • Meteorologist
  • Microbiologist
  • Park ranger – environmental/cultural/guide
  • Physicist
  • Physiologist
  • Primary school teacher
  • Secondary school teacher
  • Soil scientist
  • Soil technician
  • Statistician
  • Technical officer
  • Zoologist

Education graduates:

  • Early childhood teacher
  • Primary school teacher
  • Middle school teacher
  • Secondary school teacher
  • Special education teacher
  • School principal

Nursing/ midwifery graduates:

  • Any registered nurse/ midwife, or an enrolled nurse recognised by the relevant nursing and midwifery authority