HECS Payoff Planner — Updated for 2025–2026
HECS Repayment Calculator and Payoff Strategy Planner
Estimate HECS repayments and compare payoff strategies side by side.
Estimate your compulsory HECS repayment under the marginal rate system. Compare payoff strategies side by side and see how extra repayments shrink indexation across a multi-year projection.
HECS-HELP details
Compulsory repayments start at $67,000 for 2025-26. Use repayment income, not just base salary.
Loan details
Enter the balance currently showing in myGov or on your ATO account.
Assumes annual indexation on 1 June after any extra repayment made before indexation.
Repayment strategy
Used to recalculate compulsory repayments each projected year.
Applied immediately to your current balance before future indexation.
Modelled as one extra payment before indexation each year.
HECS-HELP Projection
First-year compulsory repayment
$3,450
15c per dollar above $67,000
- Years to clear
- 8 years
- Repayment rate
- 15.0%
- Years saved
- 0 yrs
- Indexation avoided
- $0
- Repayment income
- $90,000
- Ending balance reduction
- $0
Current path
No one-off or recurring extra repayment strategy applied.
- Starting balance
- $32,000
- Years to clear
- 8 years
- Total indexation
- $5,089
- Ending balance
- $0
With your strategy
Includes income growth, one-off repayment, and extra annual repayment.
- Starting balance
- $32,000
- Years to clear
- 8 years
- Total indexation
- $5,089
- Ending balance
- $0
How Your HECS Repayment Was Calculated
Step-by-step: repayment income, rate, indexation
Related tools
Strategy schedule
Showing the first 8 years of the projection using your strategy inputs and current policy settings.
| Year | Income | Opening | Extra | Indexation | Compulsory | Closing |
|---|---|---|---|---|---|---|
| 1 | $90,000 | $32,000 | -$0 | +$1,024 | -$3,450 | $29,574 |
| 2 | $92,700 | $29,574 | -$0 | +$946 | -$3,855 | $26,665 |
| 3 | $95,481 | $26,665 | -$0 | +$853 | -$4,272 | $23,247 |
| 4 | $98,345 | $23,247 | -$0 | +$744 | -$4,702 | $19,289 |
| 5 | $101,296 | $19,289 | -$0 | +$617 | -$5,144 | $14,761 |
| 6 | $104,335 | $14,761 | -$0 | +$472 | -$5,600 | $9,634 |
| 7 | $107,465 | $9,634 | -$0 | +$308 | -$6,070 | $3,872 |
| 8 | $110,689 | $3,872 | -$0 | +$124 | -$3,996 | $0 |
Estimate your HECS repayment, then plan your payoff with strategy comparison
Use this calculator to project your compulsory HECS repayment for the selected financial year, model a one-off lump sum or recurring extra repayment alongside expected income growth, and compare two payoff paths side by side. The projection holds policy constant for the year you choose, so you can stress-test strategies without guessing at future law changes.
For policy detail — thresholds, marginal rates, and indexation rules — the HECS/HELP repayment guide has the full reference. To see how HECS feeds into end-of-year tax, pair this tool with the tax return calculator, and use the reverse salary calculator to back-solve the gross salary you need at a target take-home with HECS factored in. If you salary package, the salary sacrifice calculator shows how reportable contributions interact with your repayment income.
Use this calculator when
- Your starting balance reflects the recent HELP debt reduction and you want to plan against the lower figure.
- You are weighing a one-off lump-sum repayment before 1 June indexation.
- You want to see how a pay rise will shift your years-to-clear under the marginal-rate system.
- You salary sacrifice and need to understand how reportable contributions move your repayment income.
Marginal-rate compulsory repayment
We apply the selected year's marginal HECS formula to your repayment income, so each band attracts only its own rate — not a flat percentage on your whole salary.
Strategy comparison
Run your current path next to a strategy that layers in income growth, a one-off repayment, and a recurring annual extra. Years saved and indexation avoided surface as headline metrics.
Indexation timing modelled
Each projected year applies indexation on 1 June after any extra repayment made beforehand, so the model mirrors how balance growth actually plays out in practice.
Year-aware policy
Switch financial years and the thresholds, marginal rates, and indexation assumptions refresh automatically. Your inputs stay; the policy follows the year you select.
Sources: ATO — Study and training loan repayment thresholds and rates · ATO — Study and training loans: what's new
Frequently Asked Questions
How is the compulsory HECS repayment calculated?
Compulsory HECS repayments are calculated against your repayment income, not your gross salary. From 2025-26 onwards, the ATO applies a marginal-rate formula to HECS-HELP debt: each band of income above the threshold attracts its own repayment rate, applied only to the income within that band — not a flat percentage on your whole salary. Once your full-year repayment income is known at tax time, the ATO works out your total compulsory repayment and reconciles it against the PAYG amounts your employer withheld during the year. The calculator above uses the selected financial year's marginal formula and your repayment income to estimate your first-year compulsory repayment, then projects how that figure shifts as your income grows. Run the numbers above to see how your repayment changes year by year.
What is the HECS repayment threshold for 2025-26?
For 2025-26, the HECS compulsory repayment threshold is $67,000. Below this annual repayment income, no compulsory repayment is required. Above it, the marginal-rate method applies — you only pay the applicable rate on income that falls inside each repayment band, not a flat percentage on your entire income. The threshold typically lifts each financial year in line with indexation, so the same dollar income can fall on different sides of the line from one year to the next. The calculator above refreshes the threshold automatically when you switch financial years, so the figure stays accurate to the policy in force for that year.
How does the 20% HELP debt reduction change my starting balance?
A one-off 20% reduction was applied to most HELP debt balances on 1 June 2025 before that year's indexation. If you have not already taken the reduction into account, the balance shown on myGov today already reflects it. To plan your payoff strategy in this calculator, enter the current balance from myGov as your starting point — that figure is already post-reduction. The reduction does not change the threshold, repayment rates, or indexation rules. It only resets your opening balance lower, which means less indexation builds up over time and your projected payoff timeline shortens. Use the calculator above to see how your remaining balance plays out under the current marginal-rate system.
What counts as repayment income?
Repayment income is broader than just salary. It combines your taxable income with reportable fringe benefits, total net investment losses, reportable employer super contributions, and certain exempt foreign employment income. For most PAYG employees with no salary packaging, repayment income is close to gross salary. For salary-packaged staff in not-for-profits, hospitals, and charities, reportable fringe benefits can lift repayment income noticeably above the cash component shown on your payslip. The ATO calculates the final figure at tax time from the components reported in your tax return. When you enter income into the calculator above, use repayment income — not base salary — for the most accurate compulsory repayment estimate.
How does salary sacrifice affect HECS repayments?
Salary sacrifice arrangements — including to super or via a novated lease — lower your taxable income but do not necessarily lower your HECS repayment income. Reportable employer super contributions and reportable fringe benefits are added back when the ATO works out your repayment income, so the same packaging that cuts your income tax can leave your HECS repayment unchanged, or in some cases nudge it higher because of the gross-up applied to fringe benefits. If you salary sacrifice, enter your repayment income — taxable income plus the reportable add-backs — rather than your cash salary in the calculator above to see the true HECS effect.
Should I make extra HECS repayments or invest the money instead?
It depends on the indexation rate compared to the after-tax return you could earn on the same money. HECS debt is indexed each 1 June, and an extra repayment made before that date reduces the balance that gets indexed — so the saving is roughly equal to the indexation rate applied to the repaid amount. If you can earn more than the indexation rate after tax in an offset account, term deposit, or diversified investment, the money may grow faster invested elsewhere; if not, repaying early avoids future balance growth and locks in a known saving. The calculator above lets you model the indexation avoided from a one-off or recurring extra repayment so you can compare it against the return you would otherwise expect.
Does HECS debt affect my home loan borrowing capacity?
Yes. Lenders treat your compulsory HECS repayment as a fixed monthly liability when assessing serviceability for a home loan, which lowers the maximum loan size you can be approved for. The size of the impact depends on your repayment income — higher repayment income produces a larger compulsory repayment and a larger reduction in borrowing capacity. The current marginal-rate system can ease the impact for some incomes compared with the older flat-rate model, because the first band of income above the threshold attracts a lower rate. Use the calculator above to estimate the compulsory repayment that lenders will plug into their serviceability calculations.
Why might extra repayments save indexation but not many years?
If your compulsory repayment is already large enough to clear the balance within a few years, an extra one-off repayment may reduce the total indexation that accrues without materially changing the payoff date. The savings still matter — indexation avoided is a real dollar reduction in what you owe over time — but they show up mainly as lower balance growth rather than years saved. For lower repayment incomes near the threshold, the same extra repayment can shift the timeline by years because it reduces the slow-moving balance more sharply. Try a one-off repayment in the calculator above to see how the trade-off plays out for your specific balance and income.
How does employer withholding relate to my final HECS repayment?
Your employer withholds an estimated HECS amount through PAYG when you tell them you have a HELP debt, but the final compulsory repayment is reconciled in your tax return based on your actual full-year repayment income. Bonuses, multiple jobs, side income, reportable fringe benefits, and salary changes during the year can all shift the actual figure higher or lower than what PAYG withheld. That is why some people see an extra HECS bill at tax time even though their employer was deducting all year. Use the calculator above to estimate the full-year repayment so you know roughly what the tax return reconciliation will produce.
More tools
Explore related calculators
Convert hours, pay, tax, super, and planning questions.
More reading
Related guides
Background reading on tax, super, and salary topics.