Get to Know Your Student Debt
Do you know how to repay your HELP debt after you graduate? Or even what you owe? In light of the proposed changes in the latest budget, maybe it’s time to get to know your student debt.
How much do you owe?
You can find out how much HELP debt you have through the ATO. Either head to the website or call 13 28 61. You’ll just need your tax file number (TFN) on hand. You can also view your HELP debt via the myGov website. Use it to keep track of indexation amounts, voluntary and compulsory repayments, and any benefits, bonuses or discounts.
When do you have to start repayments?
At the moment, the compulsory repayment threshold is $54,869 per year. The more you earn, the more you’ll have to repay. For repayment rates, check out this link.
The government wants to reduce the compulsory repayment threshold to $42,000. As it is now, there would be a sliding scale for repayments that depends on your income. It would range from 1-10%.
Can I pay it off quicker?
You can make voluntary repayments via BPAY or credit card to the ATO at any time and for any amount. You’ll need your payment reference number (PRN), which you can get when you check the size of your debt. You can also use salary packaging arrangements to increase payments. Talk to your employer and seek financial advice if you want to do this.
If you’ve heard rumours of a discount for voluntary repayments, these no longer exist (as of 1 January 2017).
Find out more here.
Can I just not pay?
No. Unless you die – if the worst happens, your debt will be cancelled and your family won’t be left with crushing debt. You will have to repay your HELP debt if you move overseas or if you declare bankruptcy. If you can’t afford the repayments, you can apply to the ATO to defer your debt. Find out more here.
If you have any questions, contact the ATO and remember to have your TFN ready.
Australian Tax Office
13 28 61
* This blog does not constitute financial or legal advice. While all efforts have been made to provide accurate information, make sure to do your own research and check for updates. Seek your own independent advice and do what’s right for you.