What is the MLS income threshold for singles in 2024–25?

For the 2024–25 financial year, singles with a taxable income above $93,000 who do not hold private hospital cover are liable for the MLS. The rate is 1% from $93,001–$108,000, 1.25% from $108,001–$144,000, and 1.5% above $144,000.

What is the family MLS threshold in 2024–25?

Families (couples and single parents) face a base threshold of $186,000. This threshold increases by $1,500 for each dependant child after the first. So a family with two children has a threshold of $187,500.

Is the Medicare Levy Surcharge the same as the Medicare Levy?

No. The Medicare Levy is a flat 2% tax that most Australian residents pay to help fund public healthcare. The Medicare Levy Surcharge is an additional charge (1%–1.5%) that only applies to higher earners who do not have private hospital cover.

Is it cheaper to get private hospital cover or pay the MLS?

It depends on your income. At $93,001 the MLS is around $930/year — basic hospital cover typically costs $1,100/year for a single, so the surcharge is cheaper at low incomes. At $150,000+ the MLS reaches $2,250/year, well above cover costs, so getting cover makes financial sense.

§ — Tax

Is the Medicare Levy Surcharge costing you more than cover?

Higher-earning Australians without private hospital cover pay an extra 1%–1.5% in tax. Enter your income below and find out your MLS rate — and whether it's cheaper to get cover or just pay the surcharge.

2024–25 tax year·Source: ATO·Read · 5 min

Your details

Taxable income

Family status

single

family

Private hospital coverExempts you from the surcharge.

Your result · 2024–25

MLS rate

Surcharge applies — you are above the singles threshold of $93,000.

MLS payable$1,000

Cheapest hospital cover est.$1,100 /yr

Net extra cost of cover−$100 /yr

2024–25 MLS rate table · singles

Income range	MLS rate
Up to $93,000	0%
$93,001 – $108,000	1.00%
$108,001 – $144,000	1.25%
Over $144,000	1.50%

What is the Medicare Levy Surcharge?

The Medicare Levy Surcharge (MLS) is an extra tax designed to encourage higher-income Australians to take out private hospital cover, easing demand on the public hospital system.

It is separate from the standard 2% Medicare Levy that almost all Australian residents pay. The MLS only kicks in for singles earning more than $93,000 (or families above $186,000combined) who don't hold an appropriate level of private hospital cover.

The surcharge is tiered. At the base rate of 1% on a $100,000 income, you'd pay $1,000 — which is typically less than the cheapest hospital cover. But as your income rises, the MLS climbs to 1.25% then 1.5%, and the financial case for getting cover strengthens. At $150,000 the surcharge reaches $2,250; a basic hospital policy often costs $1,100–$1,500 per year for a single adult.

To be exempt from the MLS, your hospital cover must have an excess no higher than $750 for singles or $1,500 for couples and families. Extras-only or ambulance-only cover does not exempt you — you need hospital cover specifically.

2024–25 MLS thresholds

Income	Singles	Families
0%	≤ $93,000	≤ $186,000
1.00%	$93,001–$108k	$186,001–$216k
1.25%	$108,001–$144k	$216,001–$288k
1.50%	> $144,000	> $288,000

Source: ATO · 2024–25 · Family threshold increases by $1,500 per dependant child after first

Cover vs surcharge: when does private health insurance make sense?

The decision to take out private hospital cover is not purely financial — peace of mind, shorter wait times, and choice of specialist all factor in. But the MLS creates a clear dollar breakeven point worth understanding.

At $93,001–$100,000 income, a single person's MLS bill is $930–$1,000 per year. The cheapest basic hospital cover for a single adult costs around $1,100 per year in 2024–25 — meaning the surcharge is actually cheaper than the cover at this income level. If your only motivation is to minimise tax, it can make sense to pay the MLS and skip cover at lower incomes.

The crossover point for a single adult (comparing a $1,100/yr basic policy against the MLS) is roughly $110,000 of taxable income, where the 1.25% tier kicks in and the MLS reaches approximately $1,375. Above that, cover becomes the cheaper option on pure cost grounds.

Lifetime Health Cover (LHC) loading is a separate reason to get covered sooner rather than later. If you take out hospital cover after your 31st birthday, you pay a 2% loading on top of your premium for every year you were aged 31 or over without cover — up to a maximum 70% loading. This can significantly increase the long-run cost of delaying.

For families, the maths tips toward cover more quickly because the cheapest family hospital policy (around $2,200/yr) still compares favourably against a 1% MLS on $200,000 combined income ($2,000). At 1.25% on $220,000 the MLS is $2,750 — well above cover cost.

MLS vs hospital cover · singles · illustrative

Income	MLS	Cover ~$1,100
$95,000	$950	$1,100
$110,000	$1,375	$1,100
$130,000	$1,625	$1,100
$150,000	$2,250	$1,100
$200,000	$3,000	$1,100

Cover estimate based on cheapest basic hospital policy 2024–25. Green = cover is cheaper.

§ Letters & replies

MLS, answered.

Common questions about the Medicare Levy Surcharge in Australia.

What is the Medicare Levy Surcharge?+ open

The MLS is an extra tax of 1%–1.5% on taxable income for higher-earning Australians who do not hold qualifying private hospital cover. It is separate from the standard 2% Medicare Levy. The ATO applies it to encourage higher earners to use the private hospital system.

What income threshold triggers the MLS in 2024–25?+ open

Singles above $93,000 and families above $186,000 (combined) are liable if they don't hold appropriate private hospital cover. The family threshold increases by $1,500 per dependant child after the first.

Is the MLS the same as the Medicare Levy?+ open

No. The Medicare Levy is 2% and paid by most residents to fund Medicare. The MLS is an additional charge (on top of the Medicare Levy) only for higher earners without private hospital cover. You can owe both at the same time.

What cover removes the MLS?+ open

You need registered private hospital cover with an excess no greater than $750 for singles or $1,500 for couples/families. General treatment (extras) or ambulance-only cover does not count.

Should I get cover just to avoid the MLS?+ open

At lower incomes ($93k–$110k) the MLS is often cheaper than even basic cover — so the pure tax argument for cover is weak. Above ~$110,000 for singles, cover usually costs less than the surcharge. Factor in Lifetime Health Cover loading too: delaying cover past age 31 adds 2% to your premium per year.

How is the MLS calculated for families?+ open

For a couple or single parent, the combined taxable income is compared to the family threshold ($186,000 base in 2024–25). If it exceeds the threshold, each individual with income above the singles threshold pays the MLS. The family threshold increases by $1,500 per dependant child after the first.

Can I avoid both the MLS and get cheap cover?+ open

Yes. "Basic" or "Bronze" tier hospital policies are specifically designed for MLS avoidance. They cover a minimum set of services at a lower premium — typically $80–$120/month for a single adult in 2024–25. Use the government's comparehealth.gov.au tool to compare all registered policies.

Related tax calculators

§ — Income