Australian Low Income Earners can Qualify for a Medicare Levy Reduction or Exemption.
The Medicare levy is currently 2% of Taxable Income, in addition to Income Tax.
If your taxable income is below a certain threshold, your Medicare Levy may be Reduced or Removed.
2016-17 Medicare Levy Thresholds.
If your taxable income is equal to or less than; $21,655 you do not have to pay the Medicare levy.
If you are a senior or pensioner, then that threshold becomes $34,244.
If your taxable income is between $21,655 and $27,068 ($34,244 and $42,805 for seniors and pensioners) then you may be entitled to a Medicare Levy Reduction.
Your Medicare Levy will be calculated at 10% of the difference between your taxable Income and the lower limit (eg: $21,655 or $34,244).
Medicare Levy Amounts Payable based on the ATO Medicare calculator for 2016/17.
Medicare Levy on Taxable Income of $21,655 is NIL
Medicare Levy on Taxable Income of $22,000 is $34.50 (equal to $22,000 less $21,655 x 10%)
Medicare Levy on Taxable Income of $24,000 is $234.50 (equal to $24,000 less $21,655 x 10%)
Medicare Levy on Taxable Income of $26,000 is $434.50 (equal to $26,000 less $21,655 x 10%)
Medicare Levy on Taxable Income of $27,068 is $541.30 (equal to $27,068 less $21,655 x 10%)
Medicare Levy on Taxable Income of $27,069 is $541.40 (equal to 2% of $27,069)
These are based on a single person, with no other exemptions
Source: www.ato.gov.au/../medicare-levy-reduction-for-low-income-earners/