Medicare Levy Surcharge (MLS)
MLS is an additional surcharge that can apply if your income is above certain thresholds and you don’t have eligible private patient hospital cover.
1) What income is used for MLS?
The ATO uses an income test for MLS purposes. It’s not always the same as taxable income.
Income for MLS purposes generally includes:
- taxable income
- reportable fringe benefits
- net investment losses (including net rental losses)
- reportable super contributions
- exempt foreign employment income (if taxable income is $1 or more)
If you have a spouse, combined income can be used to determine which tier applies.
2) Thresholds and rates (2025–26)
If you don’t have eligible hospital cover, your MLS rate is determined by the threshold tier.
| 2025–26 thresholds | Base tier | Tier 1 | Tier 2 | Tier 3 |
|---|---|---|---|---|
| Single | $101,000 or less | $101,001 – $118,000 | $118,001 – $158,000 | $158,001 or more |
| Family | $202,000 or less | $202,001 – $236,000 | $236,001 – $316,000 | $316,001 or more |
| Tier | MLS rate |
|---|---|
| Base tier | 0% |
| Tier 1 | 1% |
| Tier 2 | 1.25% |
| Tier 3 | 1.5% |
3) How OzMoneyTools estimates it
We use ATO MLS thresholds and apply the tier rate to your MLS income. Family thresholds are applied when you indicate a spouse or dependants.
To get closer estimates for MLS, enable Income components (advanced) in the calculator and enter fringe benefits, investment losses, and reportable super contributions if they apply.
FAQ
Is MLS the same thing as the Medicare levy?
Do foreign residents pay MLS?
What counts as “eligible hospital cover”?
Sources
- ATO: MLS income thresholds and rates: ato.gov.au