VET Student Loans Act 2016

Recent debt relief (2025): Debts incurred before 1 January 2025 get a 20% reduction. Debts incurred between 1 January and 1 June 2025 also get a 20% reduction.

Who qualifies as an eligible student?

You must:

• Be an Australian citizen, a permanent humanitarian visa holder usually living in Australia, a Pacific Engagement visa holder, or a qualifying New Zealand citizen (with strict 10-year residency conditions)
• Be enrolled in an approved course
• Be studying primarily in Australia
• Have been assessed as academically suitable by the course provider
• Have applied correctly (including providing your Tax File Number and Student Identifier)

What courses are eligible?

Only diploma-level and above VET courses (diploma, advanced diploma, graduate certificate, graduate diploma) that are:

• On a government-approved list (called the 'courses and loan caps determination')
• Provided by an approved course provider
• Designed to improve employment outcomes

There are loan caps — maximum amounts you can borrow for each course.

Course provider obligations (important if you run a college)

To participate, providers must:

• Be approved by the government Secretary
• Be a registered training organisation (RTO)
• Meet financial, governance and management standards
• Not use third-party brokers or agents to sign up students (this is prohibited)
• Not cold-call prospective students
• Be a member of an external dispute resolution scheme (like the VET Student Loans Ombudsman)
• Pay a 'tuition protection levy' into a fund that protects students if the provider collapses
• Keep records, provide information to the government, and cooperate with audits

Providers who break the rules face civil penalties (fines of up to 120 penalty units per breach, currently around $37,800) and can have their approval suspended or revoked.

What happens if a course provider shuts down?

There is a Tuition Protection system:

• A VSL Tuition Protection Fund collects levies from providers
• A VSL Tuition Protection Director helps students find replacement courses
• If no suitable replacement exists, the student's debt may be cancelled and the provider must repay the government

Overseas debtors

If you move overseas and stay there for more than 183 days while still owing a VSL debt, you must notify the Tax Commissioner and may still be required to make repayments based on your worldwide income.

Can decisions be challenged?

Yes — many decisions (like loan refusals, provider approvals, and debt assessments) can be reviewed through the Administrative Review Tribunal.