The big 2025-26 change: a marginal repayment system
From 1 July 2025, HECS-HELP repayments work like income tax. Instead of one rate applied to your whole income the moment you cross a threshold, you now repay a percentage only of the income above $67,000. That removes the old "cliff" where a small pay rise could cost you a big jump in repayments.
The calculator above uses this new system, so the figure you see is what actually comes out of your pay this year.
HECS repayment rates for 2025-26
These are the marginal rates the calculator applies. You only pay the rate on the slice of income inside each band.
| Repayment income | Compulsory repayment |
|---|---|
| Up to $67,000 | Nil |
| $67,001 – $125,000 | 15c for each $1 over $67,000 |
| $125,001 – $179,285 | $8,700 + 17c for each $1 over $125,000 |
| $179,286 and above | 10% of your total repayment income |
See the full breakdown, plus the 2026-27 threshold, on our HECS repayment rates page.
A worked example
Say you earn $90,000. Under the marginal system only the income above the threshold counts:
- $90,000 − $67,000 = $23,000 of income in the 15% band
- 15% × $23,000 = $3,450 compulsory repayment for the year
- That's about 3.8% of your income — roughly $133 per fortnight, withheld through your pay
Change the income above and watch the number move. Add your debt in step 2 to estimate how many years it takes to clear.
How to use this calculator in three steps
Enter your income
Type your annual repayment income or drag the slider. That alone gives your compulsory repayment.
Add your debt
Optional: enter your HELP balance and an indexation rate to project how fast it clears.
Test extra repayments
Add a voluntary amount per year and watch the payoff time drop. Download the result to keep.
Indexation and the 20% debt cut
HELP debts don't charge interest, but they're indexed on 1 June each year to keep pace with inflation. Since the 2024 reforms, indexation is capped at the lower of CPI and the Wage Price Index, and the 2025 rate was about 3.2%. On top of that, a one-off 20% reduction was applied to all student loan balances on 1 June 2025 — so your current balance is already after that cut. We explain it all in HECS indexation.
See your take-home pay, not just the repayment
A repayment figure only means something next to the rest of your pay. The "Your pay after HECS" panel above breaks your income into income tax, the 2% Medicare levy and your HECS repayment, then shows what actually lands in your account — annually and per fortnight. It's the quickest way to see how much of a pay rise the taxman and your student loan really take.
Income tax ≈ $17,788, Medicare ≈ $1,800, HECS ≈ $3,450 — leaving roughly $66,962 take-home, about $2,575 a fortnight. Your HECS is only about 5% of the total deductions.
Pay it off early, or invest? A quick framework
Because HELP charges no interest and only grows by indexation, "clear it first" isn't automatic. A simple way to decide:
- If your after-tax savings/investment return beats the indexation rate, investing usually leaves you ahead.
- If indexation is higher than what your cash earns, a voluntary repayment (ideally just before 1 June) is the better "return".
- If you're about to apply for a home loan, clearing HECS lifts your borrowing power, because lenders count the repayment as a commitment.
Use the projection above to see how a voluntary amount changes your payoff year, then weigh it against what that money could earn elsewhere. More in should I pay off HECS early.
Which loans this calculator covers
Your repayment is worked out on your combined study and training loan balance. That includes HECS-HELP, FEE-HELP, VET Student Loans, plus SSL, AASL/TSL and any old SFSS debt — they're all indexed and repaid together, so the calculator treats them as one balance. Learn the difference in what is HECS-HELP.
How this calculator works
We keep the maths transparent so you can trust the number:
- Repayment uses the 2025-26 marginal thresholds ($67,000 / $125,000 / $179,285) and rates (15% / 17% / 10% cap).
- Take-home applies the 2025-26 resident tax brackets (16% / 30% / 37% / 45%) and a 2% Medicare levy, as a single with no offsets.
- Payoff projection runs year by year: it indexes your balance on 1 June, subtracts your compulsory plus voluntary repayment, then grows your income by your wage-growth assumption for the next year.
Figures are rounded estimates for planning. Your assessed repayment income and offsets can shift the result, so treat this as a guide, not a tax assessment.
Frequently asked questions
What is the HECS repayment threshold for 2025-26?
$67,000 of repayment income. Below it you make no compulsory repayment; above it, only the income above $67,000 is used under the new marginal system. More in how HECS repayment works.
How much HECS do I repay on $90,000?
($90,000 − $67,000) × 15% = $3,450 for the year, about 3.8% of your income.
Is HECS taken out of my pay?
Yes. If you earn above the threshold, your employer withholds extra tax via PAYG and the repayment is credited when you lodge your return. You don't pay it separately.
Should I make voluntary repayments?
It can shorten your payoff time, but because HELP is indexed (not interest-charged) and repayments are income-based, it isn't always the best use of spare cash. See should I pay off HECS early.
Are these figures exact?
They're close estimates using the 2025-26 ATO thresholds. Your actual repayment depends on your assessed repayment income, so confirm with the ATO or a registered tax agent.