In the May 2024 Federal Budget, the Government proposed a change to the way that indexation is calculated against HECS-HELP and other student loans.
Once passed, the government will retrospectively adjust the indexation rates applied to loan balances at 1 June 2023 and 1 June 2024, based on the lower of the Consumer Price Index (CPI) and the Wage Price Index (WPI).
If eligible, you’ll receive a credit on your Higher Education Loan or other study or training support loan account. You do not need apply for this credit, the ATO will automatically apply the indexation credit to your account. If you’ve paid off your study loan prior to the credit being applied, you will receive a refund to your nominated bank account.
Indexation applied on 1 June 2023 will be adjusted from a rate of 7.1% down to 3.2%, whereas the indexation applied on 1 June 2024 will be adjusted from 4.7% to 4%. The only requirement that you need to meet to be eligible for the credit is that you had a student loan balance at 1 June 2023 or 1 June 2024 that was indexed, even if you have paid your debt off completely since either of these dates.
At this current time, the changes have not been implemented. However, if you have any questions about this adjustment or not sure if you’re eligible, please contact our office!
