What is VET Student Loan or HECS-HELP?

What is VET Student Loan or HECS-HELP?
12 December 2019    Lisa Clark    0 comments
HECS-HELP* is a loan scheme to help eligible students to pay their student contribution amounts through a loan or upfront discounts. It does not extend to additional study costs such as text books or accommodation.

(* Previously known as HECS or Higher Education Contribution Scheme.)
How does a VET Student Loan or HECS-HELP work?

The Australian Government will pay the amount of your loan or discount directly to your education institution. Once your income reaches a certain threshold (currently $45 991 for the 2019-2020 financial year), loan repayments are made through the tax system. If you want to pay off your debt faster, you can make voluntary repayments, regardless of how much you earn.

Who is eligible for a VET Student Loan or HECS-HELP?

To qualify for HECS-HELP, you have to meet the following requirements:
  • Be studying in a Commonwealth supported place
  • Be an Australian citizen, or a New Zealand Special Category Visa holder who meets the long-term residency requirements
  • Be enrolled in each unit at your university by the census date (1 April 2020)
  • Meet the relevant HECS-HELP residency requirements
  • Submit a valid request for Commonwealth support and HECS-HELP form by the census date, which is 1 April for 2020
When do you have to repay your HECS-HELP by?

Your HECS-HELP debt repayments will take effect through your taxes once your income passes the compulsory repayment threshold. The minimum Help Repayment Income (HRI) thresholds change each year. Where income exceeds this threshold, a compulsory repayment of at least 4% of your income takes effect as part of your tax assessment.

HECS-HELP RATES FOR 2019-2020 ARE: 
Repayment Income (RI*) Repayment Rate
 Below $45 881  Nil
$45 881 – $52 973  1%
$52 974 – 56 151  2%
 $56 152 – $59 521  2.5%
$59 522 – $63 092  3%
 $63 093 – $66 877  3.5%
 $66 878 – $70 890  4%
 $70 891 – $75 144  4.5%
 $75 145 – $79 652  5%
$79 653 – $84 432 5.5%
$84 433 – $89 498 6%
$89 499 – $94 868 6.5%
$94 869 – $100 560 7%
$100 561 – $106 593 7.5%
$106 594 – $112 989 8%
$112 990 – $119 769 8.5%
$119 770 – $126 955 9%
$126 956 – $134 572 9.5%
 $134 573 and above  10%

It’s super important to stay organised when you have an HECS debt! Save yourself a lot of time and money by keeping all work-related receipts and claim deductions paperwork in a safe place, ready for use when you have to file a tax return: this will help you to reduce your HRI come tax time, and minimise the annual HECS-HELP repayment amount.

If you want to know what you owe then head to the ATO Website where you can view your loan, and get other information such as your payment reference number (PRN) and read over other voluntary repayment options.

For more information on study loans and HESC-HELP, head to the Government's StudyAssist website here.

Main image by Element5 Digital on Unsplash  

If you would like to leave a comment, please login, or register now.

Talk money to me

Talk money to me

May 11, 2021   0 comments
We keep on hearing these weird finance words… But what does it all mean?! Discover some of the basic terms that money savvy people need t...
Read more
Life Hacks Blog
   Money
   Rental & Housing
   Mobile & Internet
   Car & Transport
   Travel & Holidays
   Killing It At Work
   Lifestyle & Entertainment
   Health & Wellbeing
   A Day In The Life Of
Skillsroad Jobs Board

Instagram

Just for you

Events, webinars, information & more

Register Now