Government Rebate on Private Health Insurance: Complete Guide

The Basics

The Australian Government Rebate is a discount on your health insurance premiums provided by the federal government to make private health insurance more affordable.

How it works:

• The government pays a percentage of your premium directly to your insurer
• This reduces the amount you pay out-of-pocket
• You receive the rebate either automatically (reduced premiums) or via tax return

Who gets it:

• Anyone with private health insurance
• Amount depends on your income and age
• Ranges from 0% to 33% of your premium

Example:

• Annual premium: $3,000
• Your rebate: 24.608% (Base tier, under 65)
• Government pays: $738
• You pay: $2,262 ($738 discount)

Why It Exists

Purpose: Encourage Australians to:

1. Take out private health insurance
2. Reduce pressure on public hospitals
3. Maintain the dual public-private health system

History:

• Introduced: 1999
• Reformed: 2012 (income testing introduced)
• Means-tested: Higher earners receive less rebate

The government's reasoning:

• Makes private insurance more affordable
• Incentivizes private hospital use
• Reduces demand on public system
• Saves government money (cheaper rebate than full public hospital costs)

Rebate vs Other Incentives

Many people confuse the rebate with other health insurance policies:

Feature	Government Rebate	Medicare Levy Surcharge	Lifetime Health Cover
What is it?	Discount on premiums	Extra tax penalty	Premium loading
Direction	Government pays you	You pay government	You pay insurer
Amount	8-33% of premium	1-1.5% of income	2% per year delayed
Based on	Income + age	Income only	Age when joining
Can avoid?	No (automatic if eligible)	Yes (get cover)	Yes (join before deadline)

Example: Person age 35, income $80k, premium $3,000/year

• Rebate: 24.608% = $738 discount (automatic)
• MLS: $0 (income below threshold)
• LHC loading: 0% (joined before deadline)

All three are separate but work together to influence health insurance decisions. Learn about Medicare Levy Surcharge → Learn about Lifetime Health Cover →

Rebate Tiers (2025-26 Financial Year)

⚠️ CRITICAL: These percentages are for 2025-26 FY only (July 1, 2025 - June 30, 2026) Update required annually. These change every financial year. Check ATO website for current rates.

[INTERACTIVE WIDGET: Rebate Eligibility Calculator]

Rebate Percentage Table

⚠️ Data for 2025-26 financial year only. Update annually July 1.

Singles (no dependents):

Income Range	Tier	Under 65	Ages 65-69	Ages 70+
<$97,000	Base	24.608%	28.710%	32.812%
$97,001-$113,000	Tier 1	16.405%	20.507%	24.608%
$113,001-$151,000	Tier 2	8.202%	12.303%	16.405%
$151,001+	Tier 3	0%	0%	0%

Families (couples and/or dependent children):

Income Range	Tier	Under 65	Ages 65-69	Ages 70+
<$194,000	Base	24.608%	28.710%	32.812%
$194,001-$226,000	Tier 1	16.405%	20.507%	24.608%
$226,001-$302,000	Tier 2	8.202%	12.303%	16.405%
$302,001+	Tier 3	0%	0%	0%

Dependent children adjustment: Add $1,500 to the family threshold for each dependent child after the first.

Example:

• Couple with 3 children
• Base family threshold: $194,000
• Adjustment: 2 children × $1,500 = $3,000
• Adjusted threshold: $197,000

Rates current as of 2025-26 financial year (July 1, 2025 - June 30, 2026). Source: Australian Taxation Office

What Counts as "Income" for Rebate Purposes?

Your "income for rebate purposes" includes:

✅ Taxable income:

• Salary and wages
• Business income
• Investment income (interest, dividends, rent)
• Capital gains (included in taxable income)
• Taxable government payments

✅ Plus these items (even though not in taxable income):

• Reportable fringe benefits
• Reportable superannuation contributions (salary sacrifice)
• Total net investment losses
• Foreign income

❌ Does NOT include:

• Tax-free government payments (e.g., Family Tax Benefit)
• Child support payments
• Tax-exempt income

This is the SAME income definition used for Medicare Levy Surcharge.

Example calculation:

• Taxable income: $90,000
• Reportable fringe benefits: $12,000
• Salary sacrificed super: $6,000
• Income for rebate purposes: $108,000
• Result: Tier 1 ($97,001-$113,000) → 16.405% rebate (under 65)

Why this matters: You might think you're in Base tier based on taxable income alone, but reportable items push you to Tier 1 (lower rebate).

Age Brackets Explained

Your age for rebate purposes:

• Determined as of July 1 of the relevant financial year
• OR when you first take out/renew the policy

Example:

• Your birthday: October 15
• You turn 65: October 15, 2025
• Financial year: 2025-26
• Age July 1, 2025: 64
• Age bracket: Under 65 (for full FY 2025-26)
• Next year (2026-27): Age bracket becomes 65-69

What if you turn 65 mid-year?

• Most insurers pro-rate: Higher rebate from your birthday onward
• Check with your specific insurer for their policy

[INTERACTIVE WIDGET: Dollar Savings Calculator]

Cost Examples by Tier

⚠️ Premium costs based on February 2026 market averages

Scenario 1: Basic Hospital Cover, Single, Under 65

Income Tier	Premium	Rebate %	Rebate $	You Pay	Monthly
Base (<$97k)	$1,440	24.608%	$354	$1,086	$91
Tier 1 ($97-113k)	$1,440	16.405%	$236	$1,204	$100
Tier 2 ($113-151k)	$1,440	8.202%	$118	$1,322	$110
Tier 3 ($151k+)	$1,440	0%	$0	$1,440	$120

Difference between Base and Tier 3: $354/year ($30/month)

Scenario 2: Bronze Hospital Cover, Single, Under 65

Income Tier	Premium	Rebate %	Rebate $	You Pay	Monthly
Base	$1,800	24.608%	$443	$1,357	$113
Tier 1	$1,800	16.405%	$295	$1,505	$125
Tier 2	$1,800	8.202%	$148	$1,652	$138
Tier 3	$1,800	0%	$0	$1,800	$150

Difference between Base and Tier 3: $443/year ($37/month)

Scenario 3: Silver Hospital Cover, Single, Age 70+

Income Tier	Premium	Rebate %	Rebate $	You Pay	Monthly
Base	$2,640	32.812%	$866	$1,774	$148
Tier 1	$2,640	24.608%	$650	$1,990	$166
Tier 2	$2,640	16.405%	$433	$2,207	$184
Tier 3	$2,640	0%	$0	$2,640	$220

Difference between Base and Tier 3: $866/year ($72/month) Note: Age 70+ gets highest rebate percentage (32.812% in Base tier)

Scenario 4: Family Gold Cover, Couple, Under 65

Income Tier	Premium	Rebate %	Rebate $	You Pay	Monthly
Base (<$194k)	$7,200	24.608%	$1,772	$5,428	$452
Tier 1 ($194-226k)	$7,200	16.405%	$1,181	$6,019	$502
Tier 2 ($226-302k)	$7,200	8.202%	$591	$6,609	$551
Tier 3 ($302k+)	$7,200	0%	$0	$7,200	$600

Difference between Base and Tier 3: $1,772/year ($148/month) Key insight: Higher premiums = larger dollar rebate (even at same percentage)

Two Claiming Methods

Method 1: Automatic Reduction (Most Common)

How it works:

• You tell your insurer your income tier and age
• They automatically reduce your premiums by the rebate amount
• You pay the lower amount each month
• Government pays insurer directly

Advantages: ✅ Immediate benefit (lower premiums now) ✅ No waiting until tax time ✅ Simplifies cash flow ✅ Most popular method (95%+ of people use this)

How to set up:

• When joining: Provide income/age details on application
• Existing members: Update via insurer's website/portal or call
• Update annually if income/age changes

Example:

• Premium: $250/month
• Rebate: 24.608%
• Rebate amount: $62/month
• You pay insurer: $188/month
• Government pays insurer: $62/month (you never see this transaction)

Method 2: Claim via Tax Return

How it works:

• Pay full premiums to insurer (no reduction)
• Claim rebate when filing annual tax return
• Receive rebate as part of tax refund

Advantages: ✅ Larger lump sum refund at tax time ✅ Useful if income varies (claim actual rebate owed)

Disadvantages: ❌ Higher monthly payments throughout year ❌ Wait until tax return processed (months delay) ❌ Need to keep records of premiums paid

How to claim:

• File tax return (Form IT1 or via myTax)
• Include private health insurance statement from insurer
• ATO calculates rebate based on actual income
• Receive rebate as part of overall refund/assessment

When this makes sense:

• Income fluctuates significantly throughout year
• You're not sure which tier you'll be in
• You prefer lump sum refunds
• Your income is near a tier boundary

When you should update:

• Income increases or decreases (crossing tier boundaries)
• You turn 65 or 70 (age bracket changes)
• Family status changes (single ↔ couple, children)
• Start of each financial year (verify still correct)

How to update with automatic reduction:

1. Log into your insurer's member portal
2. Navigate to "Rebate" or "Government benefits" section
3. Update income tier and/or age
4. Changes usually take effect next billing cycle

OR:

• Call insurer's customer service
• Provide updated income tier
• Request adjustment to premiums

Important: It's your responsibility to update. Insurers don't automatically know if your income changed.

If you don't update:

• Claiming wrong tier may result in debt at tax time
• ATO reconciles rebate when you file tax return
• If you claimed too much: Owe money
• If you claimed too little: Get refund (but paid more monthly than needed)

Understanding Tier Boundaries

The tier "cliff edges" (2025-26 FY, singles):

Crossing From	To	Income Change	Rebate Change	$ Impact on $3,000 Premium
Base → Tier 1	$97,000 → $97,001	+$1	-8.203%	-$246/year
Tier 1 → Tier 2	$113,000 → $113,001	+$1	-8.203%	-$246/year
Tier 2 → Tier 3	$151,000 → $151,001	+$1	-8.202%	-$246/year

Key insight: Crossing a tier boundary by just $1 costs you ~$246/year in rebate on a typical policy (more on expensive policies).

Legal Strategies to Manage Income

⚠️ Important: These strategies are complex and have tax implications beyond just rebate. Professional tax advice strongly recommended.

Strategy 1: Salary Sacrifice to Super

How it works:

• Salary sacrifice additional amounts to superannuation
• Reduces taxable income
• BUT: Reportable employer super contributions count for rebate purposes
• Net effect: Minimal rebate impact

Example:

• Salary: $98,000 (Tier 1)
• Salary sacrifice $2,000 to super
• Taxable income: $96,000
• Reportable super contributions: $2,000
• Income for rebate: Still $98,000 (taxable + reportable)
• Tier: Still Tier 1 (no change)

Rebate impact: Usually doesn't help with rebate tier management Other benefits: Super tax advantages, retirement savings

Strategy 2: Maximize Work-Related Deductions

How it works:

• Claim all legitimate work expenses
• Reduces taxable income
• Does help with rebate tier

Common deductions:

• Home office expenses
• Professional development
• Tools and equipment
• Travel for work
• Union fees, professional memberships

Example:

• Gross income: $98,000
• Work deductions: $2,500
• Taxable income: $95,500
• Income for rebate: $95,500 (deductions DO reduce this)
• Tier: Base (instead of Tier 1)
• Rebate savings: $246/year

Strategy 3: Timing of Income

How it works:

• Defer bonuses to next financial year
• Time capital gains realizations
• Manage investment income timing

Example:

• Normal income: $96,000 (Base tier)
• Bonus offered: $5,000 (would push to Tier 1)
• Strategy: Request bonus paid in next FY
• This year: Base tier (24.608% rebate)
• Next year: Tier 1 on $101k income

Feasibility: Limited — most employers won't accommodate When it works:

• Self-employed with flexible income timing
• Investment portfolio management (capital gains)
• Deferred compensation arrangements

Strategy 4: Income Splitting (Very Limited)

Options in Australia:

• Spouse super contributions
• Investment assets in lower-earning spouse's name

Example:

• Your income: $110,000 (Tier 1)
• Spouse income: $80,000 (Base)
• Strategy: Transfer investment assets generating $5k to spouse
• Your income: $105,000 (Tier 1, but closer to Base)
• Spouse income: $85,000 (still Base)

Family income combined anyway for rebate purposes if both have insurance, so limited effectiveness.

When NOT to Stress About Tiers

Don't implement complex tax strategies if:

1. Income is well within a tier ($10k+ from boundaries)

   • Stable income of $85k → safely in Base tier
   • Not worth the effort

2. Income growth is substantial

   • Getting $10k raise that pushes you Tier 1
   • Extra income ($10k) > rebate loss ($246)
   • Take the raise, accept tier change

3. You're in Tier 3 anyway

   • Income $180k → 0% rebate regardless
   • No rebate to optimize

4. Complexity outweighs benefit

   • Tax strategies have broader implications
   • Professional advice costs money
   • $200-300 rebate difference might not justify complexity

Bottom line: For most people, accept the tier your natural income puts you in. Don't contort finances just to optimize a $200-300 rebate. Exception: If you're within $1,000-2,000 of a boundary AND have simple strategies available (deductions you're already entitled to), claim them.

The Three Financial Incentives

All three policies work together to influence health insurance decisions:

Policy	Purpose	Your Action	Financial Impact
Government Rebate	Make insurance affordable	Get insurance	Reduce premiums 8-33%
Medicare Levy Surcharge	Penalize high earners without cover	Get insurance OR pay tax	Save 1-1.5% of income
Lifetime Health Cover	Encourage joining young	Join before age 31	Avoid 2% per year loading

Real Combined Impact Example

Scenario: Sarah, 35, Single, Income $130,000

Without Hospital Cover:

• Health insurance cost: $0
• Medicare Levy Surcharge: $1,625 (1.25% of $130k - Tier 2)
• Lifetime Health Cover loading: Accumulating 2% per year
• Total cost: $1,625 + growing future loading

With Bronze Hospital Cover:

• Premium: $1,800/year (Feb 2026 average)
• Government rebate (8.202% Tier 2): -$148
• Net cost: $1,652/year
• MLS: $0 (avoided)
• LHC loading: Prevented from increasing (already has 10% from joining at 35)

Comparison:

• Insurance: $1,652/year
• MLS if no insurance: $1,625/year
• Insurance costs $27 MORE

BUT:

• Gets actual Bronze hospital coverage
• Avoids MLS
• Prevents LHC loading increasing (would go to 12%, 14%, 16% each year delayed)
• $27/year difference is negligible given coverage benefits

Decision: Get insurance (almost identical cost to MLS, but provides benefits)

Tier Alignment Between Rebate and MLS

Good news: Income tiers are identical for both rebate and MLS (2025-26 FY)

Income (Single)	Rebate Tier	MLS Tier	Rebate % (under 65)	MLS Rate
<$97,000	Base	Tier 0	24.608%	0% (no MLS)
$97,001-$113,000	Tier 1	Tier 1	16.405%	1.0%
$113,001-$151,000	Tier 2	Tier 2	8.202%	1.25%
$151,001+	Tier 3	Tier 3	0%	1.5%

Why this matters: You only need to track one income number for both policies.

Example:

• Income: $110,000
• Rebate: Tier 1 (16.405%)
• MLS: Tier 1 (1.0%)
• Same tier for both (simplified)

Decision Framework Using All Three

Step 1: Am I subject to MLS? Income >$97k single / >$194k family?

• YES: Hospital cover required (MLS avoidance alone justifies it)
• NO: Continue to Step 2

Step 2: Am I approaching LHC deadline? Age 29-31?

• YES: Get Basic cover before deadline (avoid future loading)
• NO: Continue to Step 3

Step 3: Does rebate make insurance affordable? Calculate:

• Premium - rebate = Net cost
• Is net cost acceptable to you?

Example:

• Bronze: $1,800/year
• Rebate (24.608%): -$443
• Net cost: $1,357/year ($113/month)

Affordable?

• YES: Get cover (good value with rebate)
• NO: Skip insurance, rely on Medicare

Scenario 1: Young Professional, Base Tier

Profile:

• Emma, 28, single
• Income: $85,000
• Considering Bronze hospital cover

Rebate Calculation:

• Income tier: Base (<$97k)
• Age: Under 65
• Rebate: 24.608%

Cost Analysis:

• Bronze premium: $1,800/year (Feb 2026 average)
• Government rebate: $443/year
• Net cost: $1,357/year ($113/month)

MLS: Not applicable (income below threshold) LHC: Deadline in ~3 years (age 31) — has time

Decision: Wait until age 30, then get Basic cover:

• Save $1,357/year for 2 years = $2,714 saved
• Get Basic cover at 30 (just before deadline)
• Avoids LHC loading forever
• Can upgrade to Bronze later when income higher

Scenario 2: Mid-Career, Tier 1

Profile:

• James, 42, single
• Income: $105,000
• Has Basic hospital cover

Rebate Calculation:

• Income tier: Tier 1 ($97,001-$113,000)
• Age: Under 65
• Rebate: 16.405%

Cost Analysis:

• Basic premium: $1,440/year
• Government rebate: $236/year
• Net cost: $1,204/year ($100/month)

MLS: Would pay $1,050/year if no cover (1.0% of $105k)

Comparison:

• Insurance net cost: $1,204/year
• MLS cost: $1,050/year
• Insurance costs $154 MORE

BUT:

• Gets actual hospital coverage (Basic tier)
• At 42, health risks increase — having coverage valuable
• $154/year = $13/month (minimal difference)

Decision: Keep insurance despite costing slightly more:

• $154 extra for actual coverage is worthwhile
• MLS would provide $0 benefits for $1,050
• Maintains continuous cover (LHC loading already locked in if he joined early)

Scenario 3: High Earner, Tier 2

Profile:

• Lisa, 38, single
• Income: $140,000
• Wants Silver hospital cover

Rebate Calculation:

• Income tier: Tier 2 ($113,001-$151,000)
• Age: Under 65
• Rebate: 8.202%

Cost Analysis:

• Silver premium: $2,640/year (Feb 2026 average)
• Government rebate: $217/year
• Net cost: $2,423/year ($202/month)

MLS: Would pay $1,750/year if no cover (1.25% of $140k)

Comparison:

• Insurance net cost: $2,423/year
• MLS cost: $1,750/year
• Insurance costs $673 MORE

BUT:

• Gets Silver tier (comprehensive coverage)
• Can choose doctor, private room
• Faster elective surgery access
• At $140k income, $673/year = 0.5% of income (affordable)

Decision: Get Silver hospital cover:

• MLS alone ($1,750) nearly justifies it
• Extra $673 for Silver vs MLS provides significant coverage
• Given income level, the extra cost is manageable
• Values private healthcare access

Scenario 4: Very High Earner, Tier 3

Profile:

• Michael, 52, single
• Income: $180,000
• Considering Gold hospital cover

Rebate Calculation:

• Income tier: Tier 3 ($151,001+)
• Age: Under 65
• Rebate: 0%

Cost Analysis:

• Gold premium: $3,840/year (Feb 2026 average)
• Government rebate: $0
• Net cost: $3,840/year ($320/month)

MLS: Would pay $2,700/year if no cover (1.5% of $180k)

Comparison:

• Insurance cost: $3,840/year
• MLS cost: $2,700/year
• Insurance costs $1,140 MORE

BUT:

• Gets Gold tier (most comprehensive)
• Covers all treatments insurer offers
• At $180k income, $1,140/year = 0.6% of income
• Likely values premium healthcare

Decision: Get Gold hospital cover despite high cost:

• At this income level, prioritize quality healthcare over cost
• MLS ($2,700) is sunk cost anyway
• Extra $1,140 for Gold coverage provides best available benefits
• Can afford premium healthcare

Scenario 5: Older Person, Tier 2

Profile:

• Margaret, 72, single
• Income: $125,000 (super pension + investments)
• Has Silver hospital cover

Rebate Calculation:

• Income tier: Tier 2
• Age: 70+
• Rebate: 16.405% (70+ gets higher rebate than under 65 in same tier)

Cost Analysis:

• Silver premium: $2,640/year
• Government rebate: $433/year (16.405%)
• Net cost: $2,207/year ($184/month)

Comparison to younger person same income:

• If she were under 65: Rebate = 8.202% = $217
• Her rebate (70+): $433
• Extra rebate benefit: $216/year due to age bracket

MLS: Would pay $1,563/year if no cover (1.25% of $125k)

Decision: Definitely keep insurance:

• Higher age-based rebate makes it more affordable ($433 vs $217 for younger person)
• MLS cost ($1,563) nearly covers half the premium
• At 72, health needs likely increase — coverage valuable
• Net cost ($2,207) is reasonable for Silver coverage

Key insight: Older Australians get higher rebate percentages, making insurance more affordable when they're likely to need it most.

Scenario 6: Family, Base Tier

Profile:

• Tom & Sarah (both 36), two children
• Combined income: $180,000
• Considering Family Bronze hospital

Rebate Calculation:

• Income tier: Base family (<$194,000 + $1,500 = $195,500)
• Age: Under 65
• Rebate: 24.608%

Cost Analysis:

• Family Bronze: $4,560/year (Feb 2026 average)
• Government rebate: $1,122/year
• Net cost: $3,438/year ($287/month)

MLS: Not applicable (family income below threshold)

Decision: Consider insurance for family benefits:

• Young kids (accidents, procedures)
• $287/month for family of 4 = $72/person
• Bronze covers basic procedures, accidents
• But: Not required (no MLS)

Alternative:

• Skip insurance, save $3,438/year
• Use public hospital system (free, excellent for kids)
• Bank savings for emergency private treatment if needed

Marginal call — depends on risk tolerance and family health history.

Couples: How Rebate Works

Each person gets their own rebate based on family income tier.

Example:

• Partner A: Has hospital cover ($2,000 premium)
• Partner B: Has hospital cover ($2,400 premium)
• Combined family income: $220,000 (Tier 2 family)
• Both under 65
• Rebate for each: 8.202%

Partner A:

• Premium: $2,000
• Rebate: $164
• Net cost: $1,836

Partner B:

• Premium: $2,400
• Rebate: $197
• Net cost: $2,203

Both use COMBINED family income to determine tier, but rebate applies to each person's individual premium.

Dependent Children

Children on family policy:

• Included in family tier assessment
• Don't pay separate premiums (covered under family rate)
• Don't get separate rebate (family premium is already reduced)

Income threshold adjustment:

• First child: No adjustment
• Each additional child: +$1,500 to threshold

Example:

• Couple with 4 children
• Base family threshold: $194,000
• Adjustment: 3 additional children × $1,500 = $4,500
• Adjusted threshold: $198,500

Mid-Year Income Changes

If your income changes significantly mid-year:

Option 1: Update tier with insurer

• Changes rebate reduction on future premiums
• Easier cash flow management

Option 2: Leave unchanged, reconcile at tax time

• ATO calculates actual rebate owed
• If overpaid: Get refund
• If underpaid: Owe money

Example:

• Told insurer: Base tier (24.608%)
• Actual income end of year: Tier 1 (16.405%)
• You received too much rebate
• ATO will require repayment of difference

Safer approach: Update insurer when income changes to avoid surprises.

Part-Year Coverage

Rebate is pro-rated if you only had insurance for part of the year.

Example:

• Had cover: July 1 - December 31 (6 months)
• No cover: January 1 - June 30 (6 months)
• Annual premium if full year: $3,000
• Premium paid for 6 months: $1,500
• Rebate (24.608%): $369 (6 months only)

Mistake 1: Not Updating Income Tier

The error: "I set my rebate tier when I joined 3 years ago and never updated it."

Reality:

• Income changes
• Tier boundaries can change
• Wrong tier = incorrect rebate = debt/refund at tax time

Example:

• 3 years ago: Income $90k (Base tier)
• Set automatic rebate: 24.608%
• Now: Income $115k (Tier 2)
• Still claiming: Base tier rebate
• At tax time: ATO reconciles, you owe money back

How to avoid:

• Update tier with insurer when income crosses boundaries
• Check annually at FY start
• File accurate tax return (ATO will catch discrepancies)

Mistake 2: Confusing Rebate Tier with MLS Tier

The error: "I'm in Tier 2 for MLS, does that mean I get Tier 2 rebate?"

Reality:

• Same income tiers
• Same thresholds
• BUT different outcomes:
• MLS: You PAY extra tax
• Rebate: Government PAYS you discount

They're both based on same income, but don't confuse the mechanisms.

Mistake 3: Not Claiming When Using Tax Return Method

The error: Paying full premiums all year but forgetting to claim rebate on tax return.

Reality:

• Rebate isn't automatic unless you've opted for automatic reduction
• Must actively claim on tax return
• Need to include health insurance statement

How to avoid:

• Keep health insurance statements
• Check tax return includes private health insurance section
• Use myTax (automated) or consult tax agent

Mistake 4: Assuming Higher Income = Higher Rebate

The error: "I got a raise, so my rebate will be higher."

Reality:

• OPPOSITE: Higher income = LOWER rebate
• Rebate decreases as income increases

Correct:

• Base tier (lowest income): Highest rebate (24.608%)
• Tier 3 (highest income): Lowest rebate (0%)

Mistake 5: Not Considering Age Bracket Changes

The error: Turning 65 but not updating with insurer.

Reality:

• Age 65 = higher rebate (if still in Base/Tier 1/Tier 2)
• Not updating = missing out on extra rebate

Example:

• Age 64: Tier 1 = 16.405% rebate
• Turns 65: Tier 1 = 20.507% rebate (+4.102%)
• Premium $3,000: Extra $123/year rebate

How to avoid:

• Update with insurer when you turn 65 or 70
• Check rebate adjusted on next premium

Mistake 6: Combining Household Income Incorrectly

The error (couples): "My income is $90k and my partner's is $110k. We're both under the $97k threshold."

Reality:

• Couples use COMBINED family income
• $90k + $110k = $200k
• Family threshold: $194k
• Tier 1 family (both get 16.405% rebate, not Base 24.608%)

How to avoid:

• Add incomes together if you're a couple
• Use family thresholds (double the single thresholds)
• Check with insurer if unsure