Should I pay my HECS

It works quite well. Albeit its not making happy people.

The process requires you advise the ATO prior to departure. If you modify MyGov it then allows overseas access BUT it has to be done before departure. Or a tax agent can lodge a return and complete Item 20 - It is used by ATO to calc repayments required. The ATO want a value for foreign earnings and that is used to calc the min repayment annually which can be paid in any frequency the taxpayer wishes. Paying it can be a PITA if you close AU bank accounts as Bpay is easy. But the ATO will accept a local bank cheque or money order. I never recommend foreign transfers as exchange fees and other costs will affect the $$$ received. Can be costly eg $60 transfer processing fee per payment. ATO do take cards up to designated $$ limits too (with a surcharge)

The ATO have a process at foreign ports of departure that actually checks people's departure intentions (eg ignore holidays) and flags them at the airport. eg Debt = Yes, Departure = Permanent. They get handed a brochure. There are ATO linked terminals to assist MyGov at the main airports (not sure where I havent looked but believe they are in the departures border force counter areas)

That said there are people who have refused to comply who dont plan to return. If they do ever return for even a holiday they can be pulled aside for a chat. And refused entry for breach of tax laws on grounds of poor character.

 

I am not aware of any foreign tax jurisdiction that see HELP payments as an education cost OR allow a deduction or even any form of tax credit. HELP repayments are not a tax that is creditable under DTAs.

HELP is what people who sign a contract to borrow from the Commonwealth incur. Its a contract. Not unlike refusing to pay your credit card. Commonwealth can now add a default to a credit reporting agency for HELP.

 

In the future, the tax office will see this as another way to get money out of people. Make no mistake about it, the laws regarding HECS debt will change and won't benefit those who have a debt.

That's not to say that at the moment it's better to have the money in your pocket instead of paying it off. But living overseas doesn't indemnify one from never having to pay. The tax agencies across the world are now starting to work with one another. Banks are being forced to become more transparent. The world is shrinking. They will come for their money at some point.

It's just something to keep in the back of your mind...

 

They don't let you leave.

 

I had a help debt from years ago, which, as an expat, I wasn’t repaying.

About 2years ago they started making me pay, so I just dipped in and repayed it. It saves me having to declare my foreign sourced income.

So I gues the change was effective.

Blacky

 

Hotel California.

 

such a low rate on HESC, no other loan products come near that. why would you pay it off if not desperately needing the servicing?