HECS-HELP debt represents money borrowed from the federal government to pay for university education, repaid through the tax system once income exceeds the minimum repayment threshold. As university participation has grown and course costs have increased, HECS-HELP debt has become a significant financial consideration for many younger Australians.
ATO Taxation Statistics include data on HECS-HELP loan balances and compulsory repayments by age group and income level. Significant balances are concentrated among Australians in their twenties and thirties who have recently completed university study.
HECS-HELP debt is indexed annually to the Consumer Price Index, meaning the real value of the debt is maintained in line with inflation. During periods of high inflation the indexation rate can be substantial, increasing debt balances significantly even for those making regular repayments.
HECS-HELP compulsory repayment obligations reduce take-home pay and therefore reduce the income available to service other debt including mortgages. Lenders are required to account for HECS repayments in serviceability assessments.
Data sourced from ATO Taxation Statistics study and training support loan tables. Updated annually.