Aussies have woken up to hundreds of dollars in their bank accounts as an early Christmas present. The Australian Taxation Office (ATO) has begun issuing refunds to Australians following changes in the way student loans are indexed.
The government has wiped $3 billion in HECS debt for millions of Australians, backdating the change to June 2023. This means anyone who fully paid off their HECS debt in 2023 or 2024 after the indexation was applied will receive a refund credit in their bank accounts.
Refund Details
The ATO has stated that most people will receive their refunds by the end of January, with the average refund amounting to $400. Refunds will be issued to those without other outstanding tax or Commonwealth debts.
Checking Your HECS Balance
Aussies with outstanding HECS debts are encouraged to check their loan balance on their ATO account via myGov. The government began applying credits to accounts last week. For someone with the average HECS debt of around $27,000, approximately $1,200 will be taken off their loan.
Education Minister Jason Clare announced that more than three million Australians would benefit from this change.
Calculation of HECS Credits
Credits are based on the difference between the 2023 CPI of 7.1% and the WPI of 3.2%, along with the 2024 CPI of 4.7% and the WPI rate of 4%.
| HELP Debt at June 30, 2023 | Total Estimated Credit for 2023 and 2024 |
|---|---|
| $15,000 | $670 |
| $25,000 | $1,120 |
| $30,000 | $1,345 |
| $35,000 | $1,570 |
| $40,000 | $1,795 |
| $45,000 | $2,020 |
| $50,000 | $2,245 |
| $60,000 | $2,690 |
| $100,000 | $4,485 |
| $130,000 | $5,835 |
Future Changes
The government has announced plans to cut all student debt by a further 20% should it be re-elected next year.
This early Christmas surprise is a welcome relief for many Australians dealing with student debt. Be sure to check your ATO account to see how much your HECS debt has been reduced.
