Private ruling: Private health insurance rebate
Published: July 2012
Ruling period: Year ending 30 June 2013 Year ending 30 June 2014 Year ending 30 June 2015 Year ending 30 June 2016 Year ending 30 June 2017
Date scheme commenced: 1 July 2012

Ruling: Q1: Will you be entitled to a private health insurance rebate in excess of 20% of the premiums paid on your private health insurance policy? | A1: No.

Relevant facts and circumstances: You are over 70 years of age. You hold a single person's complying private health insurance policy. You pay premiums to the insurer under the policy. You are entitled to receive free medical care but choose to have private health insurance. Your income for (Medicare levy) surcharge purposes is expected to be in the Tier 2 range in each income year.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 61-205 Income Tax Assessment Act 1997 Section 61-210

Reasons for decision: Summary: An Australian resident who holds a complying private health insurance policy is entitled to a rebate for a percentage of the health insurance premiums they pay, or are paid on their behalf, to the insurer. The rebate may be taken in the form of a reduction in health insurance premiums paid to the insurer or as a tax offset. The amount of the rebate is governed by the Private Health Insurance Act 2007 (PHIA) and is affected by a person's age and income for (Medicare levy) surcharge purposes ('income'). In the 2012-13 financial year a single taxpayer aged 70 year or over is entitled to the following rebate provided they have not claimed premium deductions from their health insurer: 40% of the policy premiums if their income is less than $84,000 30% of the policy premiums if their income is between $84,001 and $97,000 (referred to as Tier 1) 20% of the policy premiums if their income is between $97,001 and $130,000 (referred to as Tier 2) Nil if their income is $130,001 or more (referred to as Tier 3). The income thresholds listed above are indexed on an annual basis. In your situation, you are a single person aged over 70 years of age and expect to receive income which falls within the Tier 2 threshold amounts. Thus, you will be entitled to a private health insurance rebate of 20% of your private health insurance premiums. Currently, there is no provision contained within either the taxation legislation or the PHIA which would allow you to claim a higher percentage rebate.

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