The Australian Government has delivered a major win for over 3 million Australians by legislating a 20% reduction in student debt and raising the minimum repayment threshold.
What’s Changing:
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20% automatic debt reduction for HELP, VET, apprenticeship, and other student loans based on balances as of 1 June 2025.
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The reduction is applied before indexation, and no action is needed.
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If you’ve already repaid your loan post-1 June 2025, you may receive a credit refund.
New Repayment Threshold:
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The minimum repayment income threshold rises from $56,156 to $67,000 for 2025–26.
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Compulsory repayments only apply to income earned above the $67,000 mark.
This change offers greater financial breathing room, especially for lower and middle-income earners. Voluntary repayments are still encouraged for faster loan clearance.
