MLS Thresholds 2025–26
| Tier | Single | Family | Surcharge |
|---|---|---|---|
| Base tier | $93,001 – $108,000 | $186,001 – $216,000 | 1.0% |
| Tier 1 | $108,001 – $144,000 | $216,001 – $288,000 | 1.25% |
| Tier 2 | $144,001+ | $288,001+ | 1.5% |
Should You Get Private Hospital Cover Instead?
If you earn $100,000, the MLS would cost you $1,000/year (1%). Basic hospital cover typically costs $1,200–1,800/year — but you also get hospital coverage and avoid Lifetime Health Cover loading if you're over 31. For most people above the threshold, getting private cover is the better deal when you factor in the LHC loading savings.
How It's Calculated
The MLS is based on your income for MLS purposes, which includes taxable income, reportable fringe benefits, total net investment losses, and reportable super contributions. It's not just your salary.
Frequently Asked Questions
How do I avoid the Medicare Levy Surcharge?
Take out private hospital insurance with an excess of $750 or less (singles) or $1,500 or less (families). It must be hospital cover — extras-only policies don't count.
Does the surcharge apply to families?
Yes, but the thresholds are double: $186,000 for couples/families, plus $1,500 for each dependent child after the first.
Is the MLS on top of the Medicare levy?
Yes. You pay the standard 2% Medicare levy AND the surcharge on top. At the highest tier, that's 3.5% total.