How does salary sacrifice benefit me?

Salary sacrificing is basically a way to minimise your tax bill. It involves using your pre-tax salary to buy goods or services that you’d normally buy with your after-tax pay. Because in the eyes of the tax department you’re earning less when you’re salary sacrificing, they tax you less.

What are the tax benefits of salary sacrifice?

Salary sacrifice reduces your taxable income, so you pay less income tax. Only 15% tax is deducted from your salary sacrifice amount compared to the rate you pay on your income, which can be up to 47% (including the Medicare Levy).

Is salary sacrifice beneficial?

The advantages of salary sacrifice are that you are buying the benefit in pre tax dollars. That is, if your tax rate is 32.5%, you get 32.5% better buying power. Therefore they end up in the lower tax bracket with a $78,000 income and a tax free car.

How much are you allowed to salary sacrifice?

Salary sacrificed super contributions are paid on top of your employer’s compulsory super contributions, which is currently 9.5% of your salary. There’s no limit on how much you can salary sacrifice into super. However, it’s important to consider your concessional contributions cap. This is currently $25,000.

Can a ntgpass member contribute to salary sacrifice?

Salary sacrifice contributions will only be accepted for NTGPASS Active members contributing 6 per cent in compulsory member contributions. Members of other defined benefit schemes are also unable to salary sacrifice to those schemes.

How to save money as a NT government employee?

Discover how much you can save as a NT Government employee by salary packaging a NT Gov novated lease. We have an experienced Business Development Manager based in Darwin who is a dedicated resource to assist NT Government employees with all their salary sacrifice and novated lease queries.

Are there restrictions on salary sacrifice in Australia?

The Australian Taxation Office (ATO) has set guidelines and limitations on the availability of salary sacrifice for all employees. The ATO has granted additional options for salary sacrifice for employees who work in ‘Hospital Based’ positions.

Are there any non cash benefits for salary sacrifice?

There are numerous forms of non-cash benefit that an employer can offer to employees. This quick guide looks specifically at “Cycle to Work” schemes, season ticket loans and enhanced pension contributions. The principles and administration of all salary sacrifice arrangements are broadly similar.