Is the MLS the same as the Medicare levy?

No. The Medicare levy (2%) applies to most taxpayers. The MLS (1-1.5%) is an additional charge for higher earners without private hospital cover.

What level of cover do I need to avoid MLS?

You need a complying private hospital cover policy with an excess no greater than $750 (singles) or $1,500 (families). Check with your health fund.

How much is the MLS on $150,000?

At $150,000 (Tier 2) in 2026–27, the MLS is 1.25% = $1,875 per year. Basic hospital cover often costs less than this.

Do dependent children change the threshold?

Yes, and not just the base one — every family figure moves. Each dependent child after the first adds $1,500 to the base threshold and to both tier boundaries, so the ladder shifts up rather than stretching. A family with three children has a base threshold of $213,000 in 2026–27 instead of $210,000, which is why the same $210,001 of combined income that costs a childless couple $2,100 costs them $0. A dependent child here is one under 21, or 21 to 24 and studying full-time.

My spouse earns far more than me. Do I pay it?

Possibly not. On the family basis the tiers are read against your combined income, so a low earner with a high-earning spouse can be dragged into a tier they would never reach alone — and then the surcharge is charged on their own taxable income. But the ATO exempts them outright: if your own income for MLS purposes is $28,011 or less you pay no surcharge for the year, however much your family earns. Enter your own figure in the second income box to have that applied.

Medicare Levy Surcharge Calculator

Find out if you pay the Medicare Levy Surcharge and how much, based on ATO income thresholds and private hospital cover.

The MLS applies to Australian residents whose income for MLS purposes is above the threshold and who do not have an appropriate level of private hospital cover. Rates are 1%, 1.25% or 1.5% depending on income tier.

Income & Cover

Two income figures, because the ATO uses one to decide if you pay and another to work out how much.

Income for MLS ($)

The ATO's special definition: taxable income, plus reportable fringe benefits, plus reportable employer super contributions, plus any net investment or rental losses. This decides whether you pay and at what rate — not how much. If you have a spouse, the ATO uses your combined income against the family thresholds, so enter the combined figure and choose Family below.

Amount the surcharge is charged on ($)

Your taxable income plus total reportable fringe benefits, plus any amount on which family trust distribution tax has been paid. This is a different figure from the one above: it excludes reportable super contributions and investment losses. Leave it blank if the two are the same — they are, unless you salary sacrifice or are negatively geared.

Financial Year

Status

You are a family if at any time in the year you had a spouse or a dependent child and contributed to their maintenance — regardless of what they earned.

Private hospital cover

Appropriate cover for full year avoids MLS

Medicare Levy Surcharge

Based on ATO thresholds for single status

Annual MLS

$1,200

Tier 1 — 1.00% of $120,000

Income for MLS

$120,000

Threshold used: $105,000

Tier

Tier 1: 1% (income $105,000–$123,000)

Consider private hospital cover that meets the requirements to avoid MLS. Cover must be with an Australian-registered health fund.

This calculator is for estimation only. Income for MLS is defined by the ATO and can include reportable fringe benefits, reportable super contributions and certain losses. Private hospital cover must meet specific requirements. For your exact position, see ATO – Medicare levy surcharge and ATO – MLS income thresholds and rates.

How to Use This Calculator

1Enter your income for MLS purposes (taxable income plus fringe benefits and other adjustments) — combined with your spouse's if you have one
2Select the tax year and your family status (single or family)
3On the family basis, enter your dependent children and your own share of the income figure
4Indicate whether you have private hospital cover for the full year
5See if the surcharge applies and how much you would pay

What Is the Medicare Levy Surcharge?

The Medicare Levy Surcharge (MLS) is an additional tax of 1-1.5% on top of the standard 2% Medicare levy. It applies to higher-income earners who don't have an appropriate level of private hospital cover.

The surcharge is designed to encourage people to take out private health insurance and reduce demand on the public hospital system. If you earn above the threshold and don't have cover, you pay the surcharge when you lodge your tax return.

MLS Income Thresholds (2026–27)

Tier 1 (1%): Single $105,001-$123,000. Family $210,001-$246,000.
Tier 2 (1.25%): Single $123,001-$164,000. Family $246,001-$328,000.
Tier 3 (1.5%): Single $164,001+. Family $328,001+.
Dependent children: Every family figure above rises by $1,500 for each dependent child after the first — the base threshold and both tier boundaries. Two children make the base $211,500; four make it $214,500.
Income for MLS: Taxable income plus reportable fringe benefits, reportable super contributions and investment losses. On the family basis it is you and your spouse's figures combined, and the surcharge is then charged on your own taxable income plus your own reportable fringe benefits.
The low-income exemption: A family over the threshold still pays nothing if their OWN income for MLS purposes is $28,011 or less — the Medicare levy lower threshold for 2026–27. That covers a low earner with a high-earning spouse.

Should You Get Private Health Insurance?

•Compare the cost of hospital cover vs the MLS - basic cover can be cheaper than the surcharge
•Only hospital cover counts - extras-only policies don't exempt you from MLS
•You must hold cover for the full year to avoid the surcharge completely
•The family threshold rises by $1,500 for each dependent child after the first, and so do both tier boundaries

Frequently Asked Questions

Official Sources

Rates checked against the ATO — verified 18 August 2026

Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.

Rates and thresholds last updated for the 2026–27 financial year.

About this calculator

This calculator exists to show you the arithmetic. It applies published Australian rates, thresholds and formulas to the numbers you enter and shows the working, so you can check it. That is all it does — it produces a number and describes what the number is. It does not recommend anything and it holds no opinion about any financial product.

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.

This calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. Before you make a financial decision, consider obtaining advice from someone who holds an Australian Financial Services Licence. We do not, and we cannot advise you.

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Medicare Levy Surcharge Calculator

Find out if you pay the Medicare Levy Surcharge and how much, based on ATO income thresholds and private hospital cover.

About this calculator

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.