MLS thresholds 2026-27: where each tier starts and what it costs
Type your income for MLS purposes and your situation: the tier, the surcharge rate and the rebate that go with it appear at once.
Your 2026-27 tier
Tier 1
$5,001 more income moves you to Tier 2.
| Surcharge rate without cover | 1.00 % |
| Rebate, oldest under 65 | 16.079 % |
| Rebate, oldest 65 to 69 | 20.098 % |
| Rebate, oldest 70 or over | 24.118 % |
| Thresholds (base / tier 1 / tier 2) | $105,000 / $123,000 / $164,000 |
Prepared by Radif Partners · How the figures are built · thresholds read on ato.gov.au, premiums from privatehealth.gov.au data · not tax advice
For the 2026-27 income year, which runs from 1 July 2026 to 30 June 2027, the Medicare levy surcharge starts above $105,000 of income for MLS purposes for a single person and above $210,000 for a couple, a family or a single parent, the family figure rising by $1,500 for each dependent child after the first. Above the base tier come three bands: tier 1 to $123,000 single or $246,000 family at 1 %, tier 2 to $164,000 or $328,000 at 1.25 %, and tier 3 beyond at 1.5 %. Each boundary is inclusive: $105,000 exactly is still the base tier. The thresholds rose by $4,000 for singles and $8,000 for families compared with 2025-26, while the rates did not move. The same tiers also set your private health insurance rebate, so one number on your tax return decides both. The rates apply only if you, your spouse or a dependant spent days without an appropriate level of private patient hospital cover.
The 2026-27 table
The ATO publishes the thresholds as a single table with two rows, one for singles and one for families, and four columns. We reproduce it with the rebate percentage for people under 65 next to it, since the tiers are shared.
| Tier | Single | Family (one child or none) | Surcharge | Rebate, under 65 |
|---|---|---|---|---|
| Base tier | $105,000 or less | $210,000 or less | 0 % | 24.118 % |
| Tier 1 | $105,001 to $123,000 | $210,001 to $246,000 | 1 % | 16.079 % |
| Tier 2 | $123,001 to $164,000 | $246,001 to $328,000 | 1.25 % | 8.038 % |
| Tier 3 | $164,001 or more | $328,001 or more | 1.5 % | 0.000 % |
A couple without children uses the family row, exactly like a couple with one child. The column is the same; only the increment for a second, third or later child changes it.
What changed from 2025-26
Every boundary moved up for 2026-27. For a single person the base threshold went from $101,000 to $105,000, the top of tier 1 from $118,000 to $123,000 and the top of tier 2 from $158,000 to $164,000. The family boundaries moved from $202,000, $236,000 and $316,000 to $210,000, $246,000 and $328,000. Someone whose income stays flat can therefore drop a tier this year without doing anything: a single person on $120,000 was in tier 2 under the 2025-26 table and is in tier 1 under the new one.
| Boundary | 2025-26 | 2026-27 | Rise |
|---|---|---|---|
| Single, top of base tier | $101,000 | $105,000 | $4,000 |
| Single, top of tier 1 | $118,000 | $123,000 | $5,000 |
| Single, top of tier 2 | $158,000 | $164,000 | $6,000 |
| Family, top of base tier | $202,000 | $210,000 | $8,000 |
| Family, top of tier 1 | $236,000 | $246,000 | $10,000 |
| Family, top of tier 2 | $316,000 | $328,000 | $12,000 |
Which table applies is set by the income year, not by the date you lodge. A return lodged in October 2026 is for 2025-26 and uses the old figures; the new thresholds show up on the return you lodge after 30 June 2027. Several insurer and comparison pages still printed the 2025-26 figures well into the new year, which is why it pays to check the year in the heading of any table you read.
Each tier is a step, not a slope
The surcharge is not charged on the slice of income above a threshold, as income tax is. Once you are in a tier, its rate falls on your whole taxable income and reportable fringe benefits. Crossing a boundary therefore makes the bill jump. At $123,000 a single person without cover pays $1,230; one dollar more and the figure is $1,538, a jump of $308. At the top of tier 2 the jump to tier 3 is $410. The first step, from nothing to tier 1, is the largest of all: $1,050 appears the moment income passes $105,000.
Which tier is your family in?
Your 2026-27 tier
Tier 2
| Surcharge rate without cover | 1.25 % |
| Rebate, oldest under 65 | 8.038 % |
| Rebate, oldest 65 to 69 | 12.058 % |
| Rebate, oldest 70 or over | 16.079 % |
That step shape matters for anyone near a boundary. A salary sacrifice into super does not help, since reportable super contributions are added back into income for MLS purposes. A deduction that lowers taxable income does lower it. Income for MLS purposes lists what is added back and what is not.
More children, higher family threshold
The family row rises by $1,500 for each MLS dependent child after the first. A child counts while under 21, or from 21 to 24 while studying full time; a foster child does not count. The increase applies to all three boundaries at once.
| Dependent children | Top of base tier | Top of tier 1 | Top of tier 2 |
|---|---|---|---|
| 1 | $210,000 | $246,000 | $328,000 |
| 2 | $211,500 | $247,500 | $329,500 |
| 3 | $213,000 | $249,000 | $331,000 |
| 4 | $214,500 | $250,500 | $332,500 |
| 5 | $216,000 | $252,000 | $334,000 |
The families page shows who counts as a dependent child and what happens in the year a child turns 21 or leaves full-time study.
How the ATO applies the table
You do not pick a tier on your return. You report your income test items and, at question M2, the number of days for which you do not have to pay the surcharge; your insurer's private health insurance statement gives the days of cover. The ATO then works out the tier, adds any surcharge to the Medicare levy and shows both as one line, Medicare levy and surcharge, on your notice of assessment. Nothing is withheld from your pay for it during the year.
Where these figures come from
Every number on this page is read from ATO, Medicare levy surcharge income, thresholds and rates (updated 22 June 2026), which carries the 2026-27 and 2025-26 tables, and is cross-checked against the PrivateHealth.gov.au surcharge page, which prints the same figures for both years. The rebate column comes from ATO, Income thresholds and rates for the private health insurance rebate (updated 22 June 2026). Our method page explains how the calculators apply them.