Health insurance/capital gains/medical levy surcharge

Discussion in 'Accounting & Tax' started by Barny, 14th Dec, 2018.

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  1. Barny

    Barny Well-Known Member

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    G’day all. Does capital gains when selling property get added to find what percentage of medical surcharge levy one pays?

    I decided last week to no longer renew my health insurance as I was better off without it financially. I’ve also sold property with capital gains needed to be paid.
    Just wondering if I’m better to continue with health insurance for this financial year so I reduce my tax.

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  2. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Yep....That table is misisng something. Medicare Levy SURCHARGE......

    Also consider the effect of lifetime health loading based on age.
    And likely family income based on Adjusted Taxable Income which brings fringe benefits, extra super, rental losses etc into the calcs too.

    Redundancy exempt amounts dont count but unused leave and ETPs do. I have seen many taxpayers bail on private health to have a CGT event and a redundancy all impact them.

    And remember the private health issue applies for each day you dont have cover. Its not something you can unwind easily once it starts. Often the mistake is detected in a further 8 months when you do the tax and realise the problem. Then next year is also affected
     
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  3. Barny

    Barny Well-Known Member

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    Thanks for the response paul as always.

    Since I was already with health cover for 6 months of this financial year, will I need to continue another 6 months to get the benefit of not paying the additional levy surcharge?
    Or will the first 6 months of the financial year be ok? As I won’t be getting it again for a very long time.
     
  4. Paul@PAS

    Paul@PAS Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    ??

    If you exceed the threshold then the levy applies for each day you were not covered. And the penalty can be more than any coverage. You arent a client. I have no duty of care. Should I say yes ?

    I dont understand - Are you asking me if its cheaper to speed than get a fine ?
     
  5. Barny

    Barny Well-Known Member

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    Miss understood yesterday but clearer now that I've read through this.
    Medicare Levy Surcharge Information - iSelect

    If I don't have hospital cover i will need to pay a minimum of $2100 medical levy surcharge as I fall into the highest tax bracket. My current health insurance is 1300 a year. I've paid 650 for half the year already, so I need to pay the remaining year of 650. Otherwise I'll be up for way more than the $2100 minimum levy surcharge.

    For some reason I though if I had already paid for half the year in health insurance perhaps the levy wouldn't be charged as I had insurance, but needs to be the whole year. Cheers
     
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