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What Happens to your HECS-HELP Debt Repayments If You go Overseas?

So, you’ve just finished Uni and have been offered an internship overseas! You’ve worked hard on your tertiary education (and have a hefty HECS debt to show for it) but it wasn’t all for nothing! LET’S GO!  But wait a minute… what happens with that HECS student loan? When do the HECS repayments start? Do you need to pay HECS-HELP repayments while working abroad??

No need to stress! We’ve got the answers to your questions to help you on your HECS-HELP overseas journey.

How Long Do You Need To Be Living Abroad In Order To Qualify Paying Off Your Loan?

Whether you’re overseas or on home turf in Australia, your HECS-HELP loan repayments commence when your income reaches a certain level – the length of time you’re overseas doesn’t affect those repayments. So, if you’ve just nipped off to the English countryside to trim your great-grandmother’s lawn for a cash jobby and then return to Australia, it doesn’t make a difference.  Your HECS-HELP payments will remain the same, based on your Australian earnings in the financial year.

How Much Do You Need To Earn To Start Paying Off Your HECS-HELP?

When working internationally, for tax purposes you convert/translate your income into the Australian dollar. You then repay your student loan at the regular threshold, starting at $46,620. Read more on repayment thresholds here.

How Much Do You Repay On Your HECS-HELP Working Overseas? 

The repayment amount is the same as the HECS repayment threshold percentage as if you were in Australia. As long as you notify the ATO, HECS debt repayment will be calculated with them. 

When And How Often Do You Have To Pay Your Loans 

You have to make sure you registered your income by the 31st of October with the ATO. Another alternative is to notify a registered tax agent before the 31st of October. You don’t have to pay the loan by the 31st, the ATO will notify you when it has to be paid.

Communicate What You Are Doing With The ATO or your tax agent

If you plan going overseas living consecutively, and working, for more than 183 days (6 months), to avoid any trouble with the taxation department, you need to let the ATO know what you’re doing.

Don’t move abroad and wait for the ATO to come to you with a problem. Instead, approach the ATO or your tax agent before moving.

When you contact the taxation office, you will be required to provide them with 3 things: 

  • A copy of your current, unexpired Australian passport 
  • As detailed as you can copy of your travel plans/itinerary
  • Your return dates  

What Happens If You Do Not Notify The ATO and Pay Your HECS-HELP

If you keep the ATO in the dark with your departure & intention to work out of Australia, you could be in some trouble. If you earn income above the threshold and don’t pay off your loan, you are liable for an up to $3,600 fine. A hefty penalty considering if you are earning the minimum threshold, the repayment would be less than $500 and the money wouldn’t be getting flushed down the proverbial toilet. 

How To Check Your HECS Balance: One Click Life

Before moving internationally, it is a good idea to organise your One Click Life account. It is a platform that aligns your financial and life admin into one place. It gives you a place to check how much is actually left to pay on your student loan.

Maximising Your Tax Return With An Online Tax Agent

The more you deduct, the less tax you pay and the more money you can spend on yourself. Clearly, you will want to deduct the most you can, and the sure-fire way to do that is with a tax agent or accountant. If you can claim your tax agent/tax return fee back on tax, why wouldn’t you use one to minimise your tax?

One Click Life offers fast online tax returns at your fingertips in an easy-to-use platform run by industry professionals. 

Taxes, Health Insurance, and Wills can be time-consuming and tedious. Our app allows you to be able to do this fuss-free, giving you a simple way to organise, track and manage all of your life admin in one place.

Let One Click Life take care of your tax return, and life’s essential admin tasks so you can spend more time doing the things you love.