What does it mean when people tell you "You have a good head"?

When someone says "you have a good head for something" they mean you have a natural ability to do something well.

It has the same meaning as "have a knack for something".

If you mean someone shows intelligence and good judgement instead of a special talent, use clever or smart.

High praise. It's a metaphorical use of head to mean what's contained within -- brains and the good sense to use them.

Also heard:

You have a good head on your shoulders.
You have a good head for [a particular subject].

For example, from The Ponca Tribe by J. H. Howard:

[T]he chiefs would appoint the leader. He was selected from among the bravest warriors. He had to have a good head and not to do things rashly or else the whole tribe would suffer.

Here are some cases where you might prefer this idiom over a single word, clever or smart.

1. If you want to convey the "good judgment" part.
2. If you want to use good head for something (something specific).
3. If the look and feel (or sound) of an idiomatic expression appeals to you more than a one-word description does -- in the particular context.

In 1978 I shared the bandstand (on alto saxophone) with trombonist Frank Rosolino in Cedar Rapids, Iowa. He had just done a clinic (performing and teaching) at a local high school or college, and this was a jam session which followed that. When I finished playing, he said to me, "You have a good head." I was so flabbergasted to get a compliment from one of the greatest jazz trombonists in the world, that I didn't even ask him what he meant. Probably the above description of "brains and the good sense to use them" (when improvising) would be the best definition.

Sad to say, Frank's life ended tragically later that year.