Take-home pay
HELP/HECS repayments 2026-27: the new marginal system
HELP/HECS repayments changed to a marginal system for FY2026-27 — you repay only on income above the threshold. How it works, worked examples, and what it does to your take-home pay.
If you have a HELP, HECS, VET Student Loan or similar study debt, FY2026-27 brings a genuinely better deal: a marginal repayment system. Instead of one rate applying to your whole income the moment you cross a threshold, you now repay only on the income above the threshold. This guide explains the change and shows what it does to your take-home pay.
What changed — and why it's fairer
Under the old system, crossing a repayment threshold meant a flat percentage applied to your entire income. That created painful cliffs: a tiny pay rise could trigger a much larger repayment.
Under the new marginal system:
- You repay a percentage only on income above the threshold.
- The total compulsory repayment is capped at 10% of your repayment income.
- A small pay rise no longer drags your whole income into a higher repayment.
This mirrors how income tax already works — you're taxed on the slice in each band, not on everything at once.
How the marginal repayment is calculated
PayClock's calculator uses the following FY2026-27 indexed bands (the ATO confirms exact thresholds each year, so treat these as projected/indexed):
| Repayment income band | Repayment on the income in that band |
|---|---|
| Up to ~$69,528 | Nil |
| ~$69,528 – ~$129,717 | 15% of income over $69,528 |
| Above ~$129,717 | 15% on the middle band + 17% on income above $129,717 |
The whole repayment is then capped at 10% of your total repayment income, so it can never run away from you.
Worked examples
Here's the compulsory HELP repayment at a few incomes, using the model above:
| Repayment income | HELP repayment (per year) | Roughly per fortnight |
|---|---|---|
| $70,000 | $71 | $3 |
| $80,000 | $1,571 | $60 |
| $100,000 | $4,571 | $176 |
| $130,000 | $9,076 | $349 |
Notice how gentle the start is: just above the threshold at $70,000, the repayment is only $71 for the year, because it applies only to the $472 over the line. That's the whole point of the marginal design — no cliff.
What it does to your take-home
A HELP repayment is withheld on top of income tax and the Medicare levy, so it directly reduces your net pay. Take an $80,000 salary:
- Without HELP, net take-home is about $63,880 (see How much is take-home pay on $60k–$120k?).
- With a HELP debt, subtract the $1,571 repayment → roughly $62,309 a year.
To see the figure for your income, switch on the "I have a HELP/HECS debt" toggle in the PayClock calculator — it applies the marginal system automatically.
Two things people forget
- Indexation still applies to your balance. Even below the repayment threshold, your debt is indexed each year, so the balance can move even when you're not repaying.
- Repayment income is broader than salary. It can include reportable fringe benefits, net investment losses and reportable super contributions. The ATO's study and training loan repayment page has the full definition.
Estimate only — not financial or tax advice. HELP/HECS thresholds are indexed annually and the FY2026-27 figures used here are projected/indexed pending final ATO confirmation. Confirm your exact repayment with the ATO or a registered tax agent.
Once you know your repayment, set a reminder so EOFY doesn't surprise you — free payday & EOFY reminders.