The Australian Government will provide concessional treatment of lump sum payments in arrears in determining a taxpayer's liability for the Medicare levy surcharge, the Minister for Revenue and Assistant Treasurer, Mal Brough, announced today.
This will mean that certain taxpayers who are eligible for the lump sum payments in arrears tax offset and have a Medicare levy surcharge liability may receive a reduction in their surcharge liability.
Currently, a taxpayer is liable for the Medicare levy surcharge if their income exceeds the relevant threshold and they do not have private health insurance. The concessional treatment will benefit low to middle income earners who are generally not liable for the Medicare levy surcharge but become liable in a particular year due to a large lump sum payment paid in arrears.
'The concession achieves consistency between the treatment of lump sum payments in arrears for income tax and for Medicare levy surcharge purposes,' Mr Brough said.