Pre-pay for Private Health Insurance Savings?

Simon Ellis here again…

This one’s not really a salary packaging topic – but it is tax related and some of our customers could benefit from it, so we thought it rated a mention!

As many of you would already know, changes to the Private Health Insurance (“PHI”) rebate mean that, from 1 July 2012 the 30 per cent PHI rebate will change as follows:

  • for single taxpayers earning more than $84,000, or families earning over $168,000: the rebate will drop to 20%
  • for singles earning more than $97,000, or families earning over $194,000: the rebate will drop to 10%; and
  • for singles earning over $130,000, or families earning over $260,000: the rebate will be entirely abolished

If the above changes are likely to impact you then don’t despair because there is an easy way you can extend the rebate: by pre-paying as much of your PHI as you can today.

Most Australian PHI funds have confirmed that they will accept pre-payments of premiums – some for up to 18 months – and that as long as the premium is paid before the financial year cut-off then the rebate will still apply. So if you’re a high income earner and you’ve got the spare dollars then contact your health fund today (deadlines for pre-paying are within the next few days) and see how far in advance you can pre-pay your PHI.

Even if you don’t have the spare dollars it could be well worth looking into ways of raising some quick funds for this purpose as pre-paying could save you hundreds of dollars.

Leave a comment here.

1 Response to “Pre-pay for Private Health Insurance Savings?”

  1. 1 Rob July 10, 2012 at 11:16 pm

    Hey, you fixed it quick. Good work. I spoke to one of your consultants today. Friendly, straight-forward and easily understood advice. I’ll be re-leasing my car with you, but admittedly with less “add-ons”. Cheers.

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Deven Billimoria
Chief Executive Officer

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