Study and training loan refunds

As seen in Woopi News January 2025

The Australian Parliament recently passed a bill to change the indexation rate for study and training loans which will soon become law.

In the past study loans were increased annually in line with the Consumer Price Index (CPI), however the new bill changes the indexation to be the lower of the CPI or the Wage Price Index (WPI) and is backdated to be applied from 1 June 2023. This means that the indexation rates applied 1 June 2023 and 2024 will change to:

  • 2023 3.2% reduced from 7.1%
  • 2024 4.0% reduced from 4.7%

This will lower the balances of outstanding study and training loans. For some people, this may mean that their study loan has already been paid off. If, after the adjustments, your study loan has already been paid off, you may be entitled to a refund.

Refunds will be processed through the tax system. If you have any outstanding tax debts, the refund will be applied to the debt. Any amounts that are not used to offset outstanding debts will be refunded to the bank account previously used for tax refunds.

What do you have to do?

The Australian Taxation Office (ATO) will automatically process refunds and are expecting most loans to have the adjustments applied by the end of January.

If your study loan was paid off or close to being paid off during the 2023 or 2024 years, check your MyGov to ensure your bank account details are up to date.

Proposed changes:

The government has also proposed to make other changes from 1 July 2025, these have not been passed as legislation yet:

  • The minimum payment threshold will increase from $54,435 in 2024/25 to $67,000 in 2025/26.
  • Higher Education Loan Program (HELP) repayments will be calculated only on income above the threshold, not the total taxable income.
  • A 20% reduction to the balance of all study loans.
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