Net medical expenses tax offset The net medical expenses tax offset is being phased out. From 2015–16 until 2018–19, claims for this offset are restricted to net eligible expenses for disability aids, attendant care or aged care. Net expenses are the total eligible medical expenses minus refunds from Medicare, National Disability Insurance Scheme (NDIS) and private health insurers which individuals received or are entitled to receive. This offset is income tested. If individuals are eligible for the offset, the percentage of net medical expenses they can claim is determined by their adjusted taxable income (ATI) and family status.Private Health Insurance Rebate (Rebate) - If an individual has private health insurance cover, they may be eligible for the income and age-tested Rebate. The Government also offers a higher Private Health Insurance (PHI) rebate for Australians aged 65 years and over, depending on income. If the individual doesn’t have an appropriate level of private patient hospital cover, they may have to pay the Medicare Levy Surcharge (MLS) which is an additional income-based tax. Medicare Levy - Medicare gives Australian residents access to healthcare and is partly funded by taxpayers who pay a Medicare levy of 2.0% of their taxable income. The Medicare levy is reduced when taxable income is below a certain threshold and exemptions are available for Foreign and Norfolk Island residents; those not entitled to Medicare Benefits; and those meeting certain medical conditions.