It’s a great day to be an Aussie with HECS debt thanks to some new laws passed in the Senate which means you may not have to pay back as much cashola as you think. It’s a strange yet exciting feeling to get some good news for a change, isn’t it?
On Tuesday, a bill was passed that changes the way that HECS debt is indexed. As a result, around $3 billion will be removed from more than three million loans. So, if you’re owning an average balance of $27,000, you’ll cop a refund of around $1200.
Not too shabby!
How do the changes work?
The new legislation will change the way that annual indexation on HECS-HELP debts is calculated. As it stands, the indexation rate is based on the Consumer Price Index (CPI) which measures the cost of goods and services in Australia. These rates are indexed every year on June 1st to make sure that the amount you owe is in line with inflation.
Due to mind-boggling rates of inflation in 2023, the CPI resulted in HECS loans jumping to a whopping 7.1 per cent last year. It was the highest rate we’d seen since 1990 and it felt like a huge blow amongst the rising cost of living.
From June 1, 2025, indexation will be calculated by the smaller of either the Consumer Price Index (CPI) or the Wage Price Index (WPI). This is to make sure the rates don’t overtake wage growth.
But never fear, the Government is also planning to backdate the new indexation rates. That means that the rates for 2023 and 2024 will be lowered to 3.2 per cent and 4 per cent respectively.
What about if I paid off my HECS debt after the June 2023 indexation spike?
Don’t worry, my organised friend. You will be receiving a cheeky little refund. Well, as long as you don’t have any other existing tax debts. You’ll find the refund land in your nominated bank account.
Take that as a win! Buy yourself a little treat!
How do I check if I’ve had money off my HECS Debt?
The first thing I did when I saw this law had been passed was to check my own goddamn HECS debt.
To do so, head to the ATO website or your MyGov account, which links out to your ATO account directly. After logging into your ATO account, scroll down until you see “Loan Accounts”.
On the right, it’ll show the balance. If you click the Higher Education Loan Program hyperlink (or VET Student Loan and Australian Apprenticeship Support loans), you’ll see the “2024 HELP Compulsory repayment credit” sitting pretty at the top of the list, changing the amount owed.
The Labour government have also promised to wipe an additional 20 per cent off everyone’s HECS debt and lower the repayment threshold should they be re-elected.
We’ll take what we can get, thanks!!!!
The post You Might Have Some Cashola Taken Off Your HECS Debt Thanks To New Legislation Changes appeared first on PEDESTRIAN.TV .
