HECS-HELP Debt Reduction: What You Need to Know
Millions of Australians with student loans are about to see a welcome change to their HECS-HELP balances. The Australian Taxation Office (ATO) has confirmed that the long-awaited 20% reduction to study and training loan balances will start rolling out from mid-November 2025.
This adjustment comes as part of the government’s response to last year’s unusually high indexation rate, which caused significant jumps in student debt balances across the country. The upcoming reduction aims to correct that by easing the burden for more than three million Australians.
When Will the Changes Happen?
The ATO will begin applying the 20% reduction in mid-November, with around half of all balances expected to be updated by the end of the month. The remainder should be finalised by mid-December.
You don’t need to do anything to receive the reduction — it will happen automatically. Once your balance has been adjusted, you’ll receive a notification via text or email letting you know that your new total is available to view on myGov.
How Much Will Be Wiped?
The reduction is backdated to your 1 June 2025 balance, meaning it will apply to the amount you owed as of that date.
For example, if you had the average HECS-HELP debt of $27,600, you can expect around $5,500 to be wiped from your total.
What You Need to Do
There’s no action required on your part. The process will be managed by the ATO, and updates will automatically appear in your myGov account once processed.
However, if you believe there are any discrepancies in your balance after the reduction, it’s a good idea to review your loan statement and contact the ATO or your financial adviser for clarification.
Where to Learn More
For detailed information about the HECS-HELP changes, visit the ATO’s official page here:
ATO – Study and training loans: What’s new
If you’d like to understand how these changes affect your personal financial situation or repayment strategy, contact our office — we’re here to help you make sense of it all.