Last reviewed: July 2026 · Figures current for the 2026–27 financial year
- The rebate is a government contribution toward your private health insurance premiums.
- How much you get depends on your income tier and your age. Lower income and older age mean a bigger rebate.
- You can take it as an upfront discount on your premiums, or as a tax offset at tax time.
- Singles earning over $164,000 (families over $328,000) get no rebate for 2026–27.
The private health insurance rebate is money the Australian Government puts toward your health cover premiums, so you pay less. How much you get back depends on your income and your age, and most people with cover receive it. You can take it as a discount on your premiums or as a tax offset when you lodge your return. Here's how it works, what tier you're in, and how to claim it.
What Is the Private Health Insurance Rebate?
The rebate is a government contribution toward the cost of your private health insurance. It applies to hospital cover, extras (general treatment) cover, and ambulance policies from Australian registered health insurers. It does not apply to overseas visitors health cover.
The point of it is simple: the government wants to keep private health cover affordable and take pressure off the public system, so it chips in on your premiums. For most people that's a few hundred dollars a year, sometimes more.
Two things decide how much you get:
- Your income (specifically your income for surcharge purposes, which is a bit broader than your taxable income). Higher income means a lower rebate.
- Your age. Older policyholders get a higher rebate. If you're on a couples or family policy, it's based on the age of the oldest person covered.
Australian Government Rebate on Private Health Insurance Explained
The rebate is income tested and split into four tiers, the base tier plus Tier 1, 2 and 3. It's also linked to the Medicare Levy Surcharge, using the same income thresholds. So the same income figure that decides your rebate also decides whether you'd pay the surcharge for not holding hospital cover.
One thing worth knowing up front: the rebate percentages are adjusted every year on 1 April through the Rebate Adjustment Factor. The change is small, usually a fraction of a percent, but it's why the exact numbers shift slightly each year. The income thresholds are also reviewed annually and typically bump up on 1 July. The figures on this page are current for the 2026–27 financial year.
Private Health Insurance Rebate Tiers and Eligibility
Here are the current income thresholds and rebate rates, effective 1 July 2026 to 31 March 2027, from privatehealth.gov.au.
| Tier | Singles income | Families income | Under 65 | Age 65–69 | Age 70+ |
|---|---|---|---|---|---|
| Base Tier | $105,000 or less | $210,000 or less | 24.118% | 28.139% | 32.158% |
| Tier 1 | $105,001 – $123,000 | $210,001 – $246,000 | 16.079% | 20.098% | 24.118% |
| Tier 2 | $123,001 – $164,000 | $246,001 – $328,000 | 8.038% | 12.058% | 16.079% |
| Tier 3 | $164,001 or more | $328,001 or more | 0% | 0% | 0% |
Single parents and couples (including de facto couples) are assessed under the family thresholds. For families with children, the income thresholds increase by $1,500 for each child after the first.
Source: Australian Government, privatehealth.gov.au. Rates effective 1 July 2026 – 31 March 2027.
Source: Australian Government, privatehealth.gov.au. Rebate percentages effective 1 July 2026 – 31 March 2027.
To be eligible you need to hold a complying policy with an Australian registered insurer, be a private health insurance incentive beneficiary, and have an income under the Tier 3 threshold. Earn above Tier 3 and the rebate drops to zero, though you'll still avoid the Medicare Levy Surcharge by holding hospital cover.
How Is the Private Health Insurance Rebate Calculated?
The rebate is a percentage of your premium, set by your tier and age. Find your row in the table above, and that's the share the government pays.
Here's a worked example. Say you're a single under 65 in the base tier, with a hospital policy costing $1,800 a year:
| Without rebate | With rebate (24.118%) | |
|---|---|---|
| Annual premium | $1,800 | $1,800 |
| Government rebate | $0 | –$434 |
| You pay | $1,800 | $1,366 |
| Roughly per month | $150 | $114 |
Illustrative example only. The $1,800 premium is a hypothetical figure, not a quoted price. The rebate is calculated using the real base-tier rate for a single under 65 (24.118%, 2026–27). Your premium, tier and rebate will differ.
If you have a Lifetime Health Cover loading on your hospital cover, the rebate does not apply to the loading part, only the standard premium. And on a couples or family policy, the higher age-based rebate is set by the oldest person covered.
See premiums with the rebate already applied, not sticker prices.
Compare health insuranceHow to Claim Your Private Health Insurance Rebate
There are two ways to claim, and you pick whichever suits you.
- As a premium reduction (upfront discount). You tell your insurer which income tier you expect to fall into, and they reduce your premiums straight away. This is the option most people choose because you feel the saving every month rather than waiting until tax time.
- As a tax offset. You pay the full premium during the year and claim the rebate back when you lodge your tax return with the ATO. Your rebate details are usually pre-filled.
With the upfront option you estimate your own tier. Nominate one that's too low (so you got too much rebate) and you'll repay the difference at tax time. Nominate too high and you get the difference back as an offset. There's no penalty for guessing wrong, it just reconciles. If your income is close to a threshold, err toward the higher tier to avoid a surprise debt.
Using a Private Health Insurance Rebate Calculator
If you'd rather not eyeball the table, the ATO runs an official Private Health Insurance Rebate Calculator that works out your entitlement from your income and age. You can also call the ATO on 132 861.
Or skip the admin entirely. When you compare cover with Konkrd, we factor the rebate into what you'll actually pay, so you're comparing real out-of-pocket premiums rather than sticker prices. No spreadsheets, no guessing your tier. That's the whole idea: chaos, conquered.
Frequently Asked Questions
What is the private health insurance rebate and how does it work?
It's a contribution the Australian Government makes toward your private health insurance premiums. The amount is a percentage of your premium, set by your income tier and your age. You can receive it as a discount on your premiums or claim it as a tax offset when you lodge your return.
How do I claim the Australian Government rebate on private health insurance?
Two ways. Either nominate your income tier with your insurer to get an upfront premium reduction, or pay full premiums and claim the rebate as a tax offset through the ATO at tax time. Most people choose the upfront reduction so they save each month.
What are the rebate tiers for private health insurance?
There are four: the base tier plus Tier 1, 2 and 3, based on income. For 2026–27, singles earning $105,000 or less (families $210,000 or less) sit in the base tier and get the highest rebate. Singles earning $164,001 or more (families $328,001 or more) sit in Tier 3 and get no rebate.
How is the private health insurance rebate calculated?
It's a percentage of your premium, decided by your tier and your age. For a single under 65 in the base tier, that's 24.118% for 2026–27. On a $1,800 annual premium, that's about $434 back, so you pay around $1,366.
Can I use a calculator to estimate my rebate?
Yes. The ATO has an official rebate calculator that estimates your entitlement from your income and age. Or compare with Konkrd and we'll show premiums with the rebate already applied, so you see your real cost without doing the maths.
Does the rebate affect premiums for singles, couples, and families?
Yes, but the income test differs. Singles are assessed on their own income against the single thresholds. Couples and families are assessed on combined income against the family thresholds, which increase by $1,500 for each child after the first. On a couples or family policy, the age-based rebate is set by the oldest person covered.
- Australian Government, Private Health Insurance Rebate (privatehealth.gov.au) — rebate tiers, income thresholds and rebate percentages, 2026–27.
- Australian Taxation Office, Income thresholds and rates for the private health insurance rebate — eligibility, income testing and claiming.
- Australian Taxation Office, Private Health Insurance Rebate Calculator.
This article is general information, not tax or financial advice. Rebate rates and income thresholds are set by the Australian Government and change annually. Figures are current for 1 July 2026 to 31 March 2027. For your personal situation, check the ATO or privatehealth.gov.au.
