If you’re wondering how much you need to earn before you start repaying your HELP (formerly HECS) debt ,you’re not alone. In simple terms, you only begin to repay your student loan when your income reaches $51,550 or more (2024–25 financial year). From that point, a percentage of your income is automatically withheld through the tax system based on how much you earn. This article will break down exactly how HELP/HECS repayment thresholds and rates work, how they affect your take-home pay, and what you need to watch out for.
What is a HELP (HECS) Debt?
The Higher Education Loan Program (HELP) is the Australian Government’s student loan scheme that helps eligible students cover the cost of their university or higher education. Most Australians still refer to it as a HECS debt, which was its original name.
The HELP debt system allows you to “defer” your tuition costs and repay them later through the tax system. This means you don’t have to pay upfront while studying but will gradually repay once your income meets the set threshold.
HELP/HECS Repayment Threshold for 2024–25
The compulsory repayment threshold for the 2024–25 financial year is $51,550. If your “repayment income” (which is more than just your salary, as explained below) is less than this amount, you won’t need to make repayments yet.
Once you hit this threshold, the Australian Taxation Office (ATO) will automatically withhold a portion of your pay through the PAYG (Pay-As-You-Go) system, similar to income tax.
How is “Repayment Income” Calculated?
Repayment income includes:
- Taxable income (salary, wages, etc.)
- Reportable fringe benefits
- Reportable super contributions
- Net investment losses
- Certain foreign income
- Total net rental property losses
It is your repayment income, not just your salary, that determines whether you cross the repayment threshold.
HELP/HECS Repayment Rates for 2024–25
HELP/HECS repayments work on a sliding scale ,the more you earn, the higher the percentage of your income that goes toward your debt.
| Repayment Income | Repayment Rate |
| $51,550 – $59,518 | 1.0% |
| $59,519 – $63,089 | 2.0% |
| $63,090 – $66,875 | 2.5% |
| $66,876 – $70,888 | 3.0% |
| $70,889 – $75,140 | 3.5% |
| $75,141 – $79,649 | 4.0% |
| $79,650 – $84,429 | 4.5% |
| $84,430 – $89,494 | 5.0% |
| $89,495 – $94,865 | 5.5% |
| $94,866 – $100,557 | 6.0% |
| $100,558 – $106,590 | 6.5% |
| $106,591 – $112,985 | 7.0% |
| $112,986 – $119,764 | 7.5% |
| $119,765 – $126,950 | 8.0% |
| $126,951 and above | 10.0% |
Example: How Much Will Be Deducted?
If you earn $80,000 in 2024–25, you will fall into the 4.5% repayment bracket. This means $3,600 (4.5% of $80,000) will be withheld across the year by your employer via PAYG.
Voluntary HELP/HECS Repayments
You can make additional voluntary repayments at any time. These payments directly reduce your outstanding HELP debt and can potentially reduce future compulsory repayment amounts. However, voluntary payments no longer attract a government bonus.
Voluntary repayments can be made via:
- BPAY
- Credit card (via ATO online services)
- Bank transfer
How Indexation Affects Your HELP Debt
Each year on 1 June, the government applies indexation to your outstanding HELP debt. Indexation is essentially an adjustment for inflation and is based on the Consumer Price Index (CPI).
In 2023, indexation was 7.1%, which caused many debts to grow significantly. However, the government has proposed changes to reduce the impact of indexation going forward. Always check the ATO or StudyAssist website for the latest rates.
Why Does Indexation Matter?
Even if you’re not making repayments yet, your HELP debt still grows with indexation. Making voluntary repayments can help reduce the balance and limit the effect of indexation.
What Happens if You Work Overseas?
Australian expats are still required to repay their HELP/HECS debts if their worldwide income exceeds the repayment threshold. You must report your income to the ATO annually, even while overseas.
Failing to lodge your worldwide income can lead to penalties, so if you’re working internationally, it’s crucial to keep up with your HELP debt obligations.
Tips to Manage Your HELP/HECS Debt
- Check your repayment income regularly, don’t just rely on your salary.
- Plan for indexation, especially if considering voluntary repayments.
- Keep records if you work overseas.
- Use the ATO’s repayment calculator to estimate your repayments.
Final Thoughts
In short, you only start paying your HELP/HECS debt once your repayment income reaches $51,550 in 2024–25. The more you earn, the higher your repayment rate. Indexation can also cause your debt to grow over time, so understanding how it works and considering voluntary repayments can make a difference.
Staying informed about your HELP debt ensures you avoid surprises at tax time and gives you better control over your financial future.
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