Private Health Insurance Rebates and Your Income Tier

The Private Health Insurance Rebate is an amount the government contributes towards the cost of your Private Health Insurance Premiums.

The Rebate is on an Income Tested basis which means your eligibility to receive it depends on your Income for Surcharge Purposes. If you have a higher income, your Rebate entitlement may be reduced, or you may not be entitled to any Rebate at all.

The Rebate can be claimed for premiums paid for a Private Health Insurance policy that provides private patient hospital cover, general cover (known as extras), or combined hospital and general cover.

If you meet the eligibility requirements for a Private Health Insurance Rebate, you can claim your Rebate as either :

• A premium reduction which lowers the policy price charged by your insurer
• A refundable tax offset when you lodge your tax return

When you lodge your Tax Return, we will test your Income against the Income Thresholds to determine the level of Rebate you are entitled to receive. If there was more than one adult on your Private Health Insurance Policy when the premiums were paid, you will be tested on your share of the policy.

Depending on how you claimed the Rebate, and the percentage you claimed, this may result in a Tax Liability and/or a Tax Offset.

If you claim too much Private Health Insurance Rebate as a premium reduction, we recover the amount as a Tax Liability. This liability will be listed on your Notice of Assessment as an Excess Private Health Insurance Refund or Reduction (Rebate Reduced).

If you have not received your full Private Health Insurance Rebate entitlement, we calculate the Rebate amount you are entitled to, which becomes payable to you as a Refundable Tax Offset when we assess your Tax Return. The Tax Offset is added together with any other Tax Offsets that you receive and will appear as a credit on your Notice of Assessment.