The Australian Government is reducing Higher Education Loan Program (HELP) debt by 20%, this is subject to the passage of legislation.
The Government has committed to this being the first piece of legislation it introduces when the new Parliament returns from 22 July 2025.
On 1 June 2025, indexation will be applied to HELP debts by the Australian Taxation Office (ATO) as part of the normal annual indexation process. More information on the HELP debt indexation rate is available on the ATO website.
However, once the legislation comes into effect, the ATO will retrospectively apply the 20% reduction to the balance of your HELP debt at 1 June and the indexation that was applied will be adjusted.
This means that indexation would apply only to the remaining balance of your HELP debt e.g. after the HELP debt has been reduced by 20%.
More FAQs about what will happen on 1 June 2025 and the timing of the 20% reduction are now available.