HECS-HELP Repayment Calculator Australia — Years to Debt-Free FY2025–26
How the HECS-HELP Repayment Calculator Australia Works
HECS-HELP repayment income thresholds — FY2025–26 (ATO Schedule 9)
| Annual Income | Repayment Rate | Annual Repayment on Min Income |
|---|---|---|
| Below $54,435 | Nil | $0 |
| $54,435 – $62,998 | 1.0% | $544 – $630 |
| $62,999 – $66,819 | 2.0% | $1,260 – $1,336 |
| $66,820 – $70,539 | 2.5% | $1,671 – $1,763 |
| $70,540 – $74,919 | 3.0% | $2,116 – $2,248 |
| $74,920 – $79,489 | 3.5% | $2,622 – $2,782 |
| $79,490 – $84,268 | 4.0% | $3,180 – $3,371 |
| $84,269 – $89,524 | 4.5% | $3,792 – $4,029 |
| $89,525 – $95,092 | 5.0% | $4,476 – $4,755 |
| $95,093 – $100,996 | 5.5% | $5,230 – $5,555 |
| $100,997 – $107,214 | 6.0% | $6,060 – $6,433 |
| $107,215 – $113,847 | 6.5% | $6,969 – $7,400 |
| $113,848 – $120,899 | 7.0% | $7,969 – $8,463 |
| $120,900 – $128,392 | 7.5% | $9,068 – $9,629 |
| $128,393 – $136,331 | 8.0% | $10,271 – $10,907 |
| $136,332 – $144,730 | 8.5% | $11,588 – $12,302 |
| $144,731 – $151,200 | 9.0% | $13,026 – $13,608 |
| $151,201+ | 10.0% | 10% of income |
Real-World Examples — 2026
$35,000 HECS, $72,000 income, 3.5% income growth
With $35,000 HECS balance at $72,000 income: FY2025–26 repayment rate is 3.5% = $2,520. Indexation at 3.2% adds approximately $1,120 to the balance. Net reduction: $1,400. Projected years to debt-free with 3.5% annual income growth: approximately 12 years. Total repaid including indexation: approximately $38,500.
$55,000 HECS, $110,000 income
With $55,000 HECS balance at $110,000 income: repayment rate is 6.5% = $7,150/year withheld via payroll. Indexation at 3.2% adds approximately $1,760. Net annual debt reduction: $5,390. Projected years to debt-free: approximately 8 years. The higher income accelerates repayment significantly.
Frequently Asked Questions
How does HECS-HELP indexation work?
HECS-HELP balances are indexed each year on 1 June using the lower of the Consumer Price Index (CPI) or the Wage Price Index (WPI), as amended by legislation in 2023. Before 2023, only CPI was used — resulting in an indexation rate of 7.1% in 2023 (the highest in decades). From 2024 onwards, the lower of CPI or WPI is used, resulting in indexation of approximately 4.0–4.7% in 2024 and an expected 3.0–3.5% in 2025–26.
What is the HECS minimum repayment threshold for FY2025–26?
The minimum repayment income threshold for FY2025–26 is $54,435. If your taxable income is below this amount, no HECS repayment is required — whether you lodge a tax return or not. The repayment rate starts at 1% of income at the threshold and rises progressively to 10% for incomes above $151,201.
Should I voluntarily repay my HECS debt early?
This depends on your situation. HECS-HELP is an unusual debt: it has no interest (only indexation at CPI/WPI), and repayments are income-contingent (paused if your income falls). Prior to 2023, the ATO offered a 5% bonus for voluntary repayments of $500+ — this incentive was abolished from 1 January 2017. Today, there is no financial benefit to voluntary repayment beyond the indexation rate — if indexation is 3%, paying off HECS is equivalent to earning a guaranteed 3% return on that money.
Does HECS-HELP debt affect my home loan borrowing capacity?
Yes. Lenders include compulsory HECS repayments as a committed expenditure when assessing your borrowing capacity. For example, on a $95,000 income with a 5.5% repayment rate, HECS reduces your disposable income by $5,225/year — which reduces borrowing capacity by approximately $80,000–$100,000 depending on the lender's assessment methodology.
What happens to my HECS debt if I move overseas?
From 1 January 2016, Australians with HECS-HELP debt who move overseas are required to make repayments if their worldwide income exceeds the repayment threshold. The ATO requires overseas borrowers to complete a Worldwide Income Assessment each year. Historically many Australians living overseas did not repay — this system closed that loophole.