HECS-HELP is Australia's income-contingent student loan system — one of the most borrower-friendly in the world. Understanding exactly how it works changes many people's approach to paying it off.
The key facts about HECS-HELP in 2026
| Feature | Detail |
|---|---|
| Repayment threshold | $54,435/year (2026-27) |
| Repayment rate | 1–10% of income (sliding scale based on income) |
| Interest charged | None — but indexed to CPI annually (June) |
| Deducted from pay | Yes — via PAYG withholding like tax |
| Affects credit score | No |
| Written off if | Death or permanent disability |
The CPI indexation issue
HECS-HELP doesn't charge interest — but it's indexed to CPI each year on 1 June. In 2023, CPI was 7.1%, meaning a $30,000 HELP debt jumped to $32,130 overnight. In years of high inflation, this can be significant. In low-inflation years (2-3%), it's much less concerning.
Should you voluntarily repay HELP debt?
The maths is straightforward:
- If your high-interest savings account rate > CPI indexation rate: keep money in savings, let mandatory repayments chip away at HELP
- If CPI indexation rate > savings rate: voluntary repayment makes sense
- In 2026 with savings rates at 5%+ and CPI ~3%: savings wins, don't rush to repay
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About the author
Enrique 'Kike' Faúndez is an Information Systems and Management Control Engineer from Universidad de Chile, with master’s degrees in Finance from Universidad de Chile and Industrial Engineering from Pontificia Universidad Católica de Chile. He has 15+ years of experience in regulated financial services across finance, operations, and digital product development. He founded CashControlly in Santiago, Chile, with the conviction that personal financial control should not be a privilege, but an accessible and well-designed tool.
- Master's in Finance, Universidad de Chile
- Master's in Industrial Engineering, Pontificia Universidad Católica de Chile
- Information Systems and Management Control Engineer, Universidad de Chile
- AI and ITIL certifications
- 15+ years in regulated financial services
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