The bill to change the annual indexation for study and training loans passed parliament. The differences will be refunded to your account.

This change applies to Higher Education Loan Program (HELP), VET Student Loan, Australian Apprenticeship Support Loan and other student support loans.

This legislation fixes the way indexation is calculated on student debt and will be backdated to 1 June 2023.

The new indexation rates for the two previous years are:

• 2% for 1 June 2023 – reduced from 7.1%
• 4% for 1 June 2024 – reduced from 4.7%

The ATO will automatically apply these changes to everyone with a student loan.

Most people will see these credits on their accounts by the end of January 2025. Some credits will take a bit longer than others to show on their accounts depending on the complexity.

If your study or training loan account is in credit after the adjustment, this credit will be transferred to your Income Tax account. It will then be applied against other primary tax or Commonwealth debts (if applicable), and any remaining amount refunded to the client’s nominated bank account.

For more information or personalised guidance, feel free to contact our team of experts at LZR.