Working holiday visa holders (subclass 417 & 462) are generally exempt from the 2% Medicare levy — here's how to check your eligibility and claim it.
Save 2% of your taxable income · Automatically applied when you lodge with a valid Medicare Entitlement Statement
Save 2% of your income!
Example: $50,000 income = $1,000 saved
The Medicare levy is an extra 2% of your taxable income that most Australian taxpayers pay to help fund the public healthcare system. As a working holiday visa holder, you're generally not eligible for Medicare — which means you may be exempt from paying this levy altogether.
Unlike the Low Income Tax Offset, the Medicare levy exemption isn't applied automatically. You need a Medicare Entitlement Statement (MES) from Services Australia, and you claim the exemption when you lodge your tax return.
Automatic savings, once claimed
If you earn $50,000 during the year, a full exemption saves you $1,000 — money most WHV holders leave on the table simply because their tax agent doesn't ask about it.
Eligibility depends on your visa, your income, and whether your home country has a Reciprocal Health Care Agreement (RHCA) with Australia.
| Eligible | Not eligible |
|---|---|
| You hold a 417 or 462 working holiday visa and aren't eligible for Medicare | You're an Australian tax resident who is eligible for Medicare |
| Your country has no reciprocal health agreement with Australia (full exemption, category 3) | You already hold Medicare cover as a permanent resident or citizen |
| Your country has a Reciprocal Health Care Agreement (partial exemption, category 2 — see list below) | You're covered by Medicare through a partner visa or other pathway |
| You held private health/travel insurance instead of Medicare for the relevant period | You've already claimed Medicare benefits during the period in question |
If you're from one of the countries below, you may only qualify for a partial exemption, because Australia's reciprocal agreement gives you limited access to Medicare for essential treatment while you're here:
If your country isn't on this list, you generally qualify for the full exemption.
These two are often confused, but they're separate things:
The standard 2% charge most taxpayers pay. WHV holders can be exempt from this.
An extra charge for higher earners who don't hold private hospital cover. It doesn't generally apply to WHV holders, since the surcharge targets Medicare-eligible taxpayers.
If you're not eligible for Medicare in the first place, the surcharge question doesn't apply to you — but it's worth confirming with us if you have private health insurance through an employer.
Request your Medicare Entitlement Statement online through your myGov account linked to Medicare, or by phone/in person with Services Australia.
Processing times vary — apply as early as possible in the tax season so you have your statement ready before you lodge.
We add the exemption details to your return using the dates on your MES, and keep the statement on file as evidence.
Income: $30,000
Saved: $600
Income: $40,000
Saved: $800
Income: $50,000
Saved: $1,000
Full exemption examples. If you only qualify for a partial exemption (RHCA country), the saving is calculated for the portion of the year you weren't Medicare-eligible.
❌ Not applying for a Medicare Entitlement Statement at all — the exemption can't be claimed without it.
❌ Leaving Australia before requesting the MES, then struggling to get one from overseas.
❌ Assuming the exemption is automatic, like LITO — it isn't.
❌ Not realising RHCA countries only get a partial exemption, not a full one.
❌ Missing the exemption on returns from previous years that are still amendable.
Generally no. Most WHV holders aren't eligible for Medicare, so they can claim a full or partial exemption from the 2% levy — but only once they have a Medicare Entitlement Statement and claim it on their return.
It's a document from Services Australia confirming you weren't eligible for Medicare during a specific period. You need one for every income year you want to claim the exemption for.
Processing times vary by season, so we recommend applying as early as possible — ideally before you plan to lodge your return, and well before you leave Australia.
You may only get a partial exemption rather than a full one, since the agreement gives you limited access to Medicare for essential care. See the country list above.
Holding private travel or overseas student health cover doesn't make you Medicare-eligible — it actually supports your case for the exemption, since it shows you weren't relying on the public system.
If you're still within the amendment window for a prior return, we can review whether the exemption was claimed and lodge an amendment if it wasn't.
You'll need the exemption category and the number of days from your Medicare Entitlement Statement. We handle this for you when we lodge on your behalf.
No. The levy exemption relates to the standard 2% charge; the surcharge is a separate, higher-income charge that generally doesn't apply to WHV holders in the first place.
Last updated: July 2026
We’ll let you know your total return during our call.