The Australian Taxation Office has started a refund process for HECS loan borrowers who have fully settled their HECS debt in 2024 or 2023. The government recently changed the way HECS will be indexed, offering students some debt relief.
Students can get their refunds before Christmas and enjoy the holidays, but some may see their refunds later. Students wondering about ATO HECS refunds can check full details here after the 2023 and 2024 indexation cuts.
ATO HECS refund
Australians who have taken part in the Higher Education Loan Scheme – HECS to get interest-free loans for their higher education can expect some refund if they have repaid their loan. In the HECS program, the Department of Education offers students financial assistance for their tuition fees, room, board, etc. The amount will be paid directly to the educational institutions.
Under the scheme, students can repay the loan when their income reaches a certain threshold, and loan repayments are made through the ATO. In the Higher Education Contribution Scheme, students receive points when they have a HELP debt indexed to a certain date.
Under HECS debt, the credit will take care of the amount you owe, but if you’ve already paid off the debt, the credit will turn into your HECS refund, which the ATO pays you. Now that the Australian government has launched debt relief and reduced indexation, students who have paid off their HECS debt this year or the previous year can expect a refund.
How do you check if you will get a HECS refund?
The authority indexed the HECS HELP loan in June each year to ensure that it remains in line with inflation, i.e. the consumer price index. However, the government has now changed the indexation measures and says that indexation will be carried out either in line with the wage price index or the CPI, whichever is lower, to reduce the financial pressure on students.
Now, with the indexation, the ATO has sent a message to borrowers urging them to check their HECS-HELP credit balance in their ATO account online as they have reduced it based on the reduced indexation for 2023 and 2024.
Many students’ debt will be reduced based on a 20% debt reduction as indexation is applied. Students can check their ATO balance on their MyGov account in the following steps:
- First you need to go to your MyGov account at
- If you don’t have one, you can simply create your MyGove account and go to the Services section.
- You should then go to the ATO section and find the Loan Account section in it.
- Below the description line you can find HELP and the balance you have to pay off.
People who have no funds and have paid off their loan can expect a refund from the ATO. Due to deleveraging, many debts have been cut, so Australians should check their balances.
How much HECS refund can you expect?
Under the HECS program, points and refunds depend on the participant’s circumstances. Participants should understand that people who paid off their debt before indexation in 2023 will not get a refund, this is for people who paid off their debt after indexation and paid their debt in 2023 or 2024.
The amount of HECS refund will depend on many factors, such as the participant’s credit rating when indexation is applied and many others. However, the ATO has published an estimated average amount that can be received by participants who have paid off their debt of $400.
When can you expect a HECS refund?
According to the ATO notice, the tax office has started the refund process for students who will be entitled to a refund based on their debt-free balance in their HELP loan account and have no other debts. Some students who have already paid off their debt must have already received a refund.
The refund is automatically processed by the ATO so that those who qualify will receive a refund, however some participants may expect a delay or longer time to receive their refund due to the complexity of their account and other factors.
According to the ATO, most Australians who settled their HECS debt in 2023 or 2024 after indexation is applied can expect a HECS refund in their account by the end of January 2025. Australians can expect a HECS refund in their bank account that they listed in their tax return to receive a tax refund.
Australians who have changed their bank account for any reason, so report to the Tax Office immediately or go to MyGov to change or update your bank account details to get your refund on time.
Will the current changes to HECS affect points?
The Australian Government has announced that from 2025, indexation will be based on the lowest of CPI and indexed wages to ensure that students who have just started earning do not feel financial pressure to repay their debt and that their debt does not increase.
Now, under the current June 2024 indexation, it applied at a rate of 4.7%, which has now been reduced to 4%, this will affect the loans applied to pay off your HECS debt. Since the indexation measure will be different, it will also affect the indexation points.
Indexation will be added to your credit each year, students can use the HELP Loan Indexation Estimator to see their Loan Indexation Index for that year. For example, a person with a HEL{ debt of $26,500 in 2023 received a loan of about $1,190.
Australians who took out a HELP loan and are repaying the loan after indexation last year or this year can expect to receive their money back as soon as the end of January 2025.
