How to Calculate Your Worldwide Income for HECS/HELP Reporting

Right, let’s be upfront: this is one of those tax topics that sounds simple and isn’t. “Just report your worldwide income,” says the ATO, as if that’s a single obvious number sitting in your bank app. In reality there are three different ways to work it out, they give different results, and choosing the wrong one can cost you. So grab a cuppa, because we’re going to make this genuinely clear, which is more than the official guidance usually manages.

If you’ve got a HECS-HELP debt (or a VET Student Loan or an Australian Apprenticeship Support Loan) and you’re living overseas, this is the calculation you need to get right each year.

First, do you even need to report?

Two thresholds matter here, and people muddle them constantly.

The reporting threshold is the lower one. If your worldwide income (converted to Australian dollars) is above 25% of the minimum repayment threshold, which works out to $16,750 for 2025-26, you must report it to the ATO, even if you won’t actually owe a repayment. If you’re below it, you generally lodge a simple non-lodgement advice instead, just to tell the ATO you’re under.

The repayment threshold is the higher one. Only once your worldwide income exceeds $67,000 (for 2025-26) do you actually start making compulsory repayments, now calculated on a marginal basis (a percentage of the income above each threshold, rather than your whole income). So you can be in the zone where you must report but don’t yet have to pay. Annoying, but that’s the rule.

The three methods to calculate your worldwide income

Here’s the part that surprises people. The ATO gives you three methods to work out your foreign-sourced income, you pick one each year, and you’re free to switch methods from year to year depending on what suits you. They are the simplified self-assessment method, the overseas assessed method, and the comprehensive tax-based assessment method. Let’s take them one at a time.

Method 1: Simplified self-assessment

This is the quick-and-easy option, and for many people it’s perfectly fine.

You add up all your foreign income for the Australian financial year (1 July to 30 June), convert it to Australian dollars using the ATO’s published foreign exchange rates, and add any Australian-sourced income. The ATO then automatically applies a standard deduction based on the occupation you nominate, and the result is your worldwide income. You don’t itemise anything; the standard deduction does the work.

The catch: that standard deduction is a one-size-fits-all figure for your occupation, and it might be a lot less than the deductions you could actually claim. If you select “occupation not listed” (say you’re an investor or retiree), the standard deduction is zero. So it’s simple, but simple isn’t always cheapest.

Method 2: Overseas assessed method

If your foreign country already taxed you and handed you a tidy assessment, this method lets you lean on it.

You take the taxable income figure from your foreign tax assessment, convert it to Australian dollars, and add any Australian-sourced income. Done. It’s convenient because the foreign tax office has already done the sums.

But there are firm conditions. Your foreign tax assessment has to cover a 12-month period that overlaps the Australian income year. You can’t use it if more than one country assessed your income, and you can’t reuse a foreign assessment you’ve already used in a prior year. If your foreign tax year lines up neatly and only one country’s involved, this can be the path of least resistance; if your situation is messier, it’s off the table.

Method 3: Comprehensive tax-based assessment

This is the thorough option, and for higher earners with real deductions it’s often the one that saves the most.

You list all your foreign income for the Australian financial year, convert it to Australian dollars, add any Australian-sourced income to get your gross worldwide income, and then claim deductions exactly as if you’d earned that income in Australia. You’re applying Australian tax rules to your foreign income, so the same work-related deductions you’d be entitled to here can reduce the figure you report.

The trade-off is paperwork. You need to keep receipts and records to substantiate every deduction, and where an expense was part work and part private, you can only claim the work-related slice. More effort, but potentially a much lower reportable income (and therefore a smaller repayment) than the simplified method’s standard deduction would give you.

Which method should you use?

There’s no universal answer, which is rather the point of having three. As a rough guide: the simplified method suits people with straightforward affairs and modest deductions; the overseas assessed method suits those with a clean, single-country foreign assessment that lines up with the Australian year; and the comprehensive method suits higher earners with genuine, substantiable deductions worth claiming. Because you can switch year to year, it’s worth running the numbers (or having someone run them) rather than defaulting to whichever you used last time.

How to actually report it

Once you’ve landed on your worldwide income figure, you report it (along with your occupation and current overseas address) in one of a few ways: through ATO online services via myGov, by lodging an Australian tax return through myTax, or by having a registered tax agent prepare and lodge it for you. Whichever way, the deadline is generally 31 October for the prior financial year, and if you’re below the reporting threshold you lodge that non-lodgement advice instead so the ATO knows where you stand.

Where this fits with the rest

This piece is the deep-dive on the calculation itself. For the broader picture, we’ve got companion guides on repaying HELP debts as an expat and on your wider HELP debt obligations as an expat, including the difference between voluntary and compulsory repayments and between the reporting and repayment thresholds.

The bottom line

Calculating your worldwide income for HELP isn’t one calculation, it’s a choice between three, and the right choice depends on your income, your deductions and whether you’ve got a tidy foreign assessment to lean on. Report if you’re over $16,750, repay if you’re over $67,000, pick the method that genuinely suits your year, and keep your records. Get it right and it’s just routine annual admin; get it wrong and you either overpay or end up tangled with the ATO.

Tread your own path. Just pick the right method to measure it.

Don’t fancy doing this maths three different ways? We’ll handle it.

Working out which of the three methods leaves you best off, converting currencies, applying the right deductions and lodging it correctly is exactly the kind of fiddly annual task that’s easy to get wrong and easy to hand over. We’ll run the numbers, choose the most effective method for your circumstances, and lodge it for you.

Our specialist expatriate tax team handles HELP worldwide income reporting for Australians right across the globe, entirely remotely.

Book an appointment with our expat tax specialists today and let us take the calculation off your plate. A bit of help now saves a world of bother later.

General information only. This article doesn’t consider your personal circumstances and isn’t tax or financial advice. Study loan rules, thresholds and methods change over time. Speak to our specialist expatriate tax team today, or with another registered tax agent, before acting.

References

1. Australian Taxation Office, “Overseas obligations when repaying loans” (the three income assessment methods and overseas reporting obligations): ato.gov.au
2. Australian Taxation Office, “Non-resident foreign income” myTax instructions (the simplified self-assessment, overseas assessed and comprehensive tax-based methods, and the automatic standard deduction by occupation): ato.gov.au
3. Australian Taxation Office, “Study and training loan repayment thresholds and rates” (the 2025-26 minimum repayment threshold of $67,000 and the marginal repayment system): ato.gov.au
4. Australian Taxation Office, “Foreign exchange rates” (the published rates used to convert foreign income to Australian dollars): ato.gov.au