| Welcome to Yanks Down Under! You're currently viewing our forum as a guest. This means you are limited to certain areas of the board and there are some features you can't use. If you join our community, you'll be able to access member-only sections, and use many member-only features such as customising your profile, sending personal messages, and voting in polls. Registration is simple, fast, and completely free. Join our community! If you're already a member please log in to your account to access all of our features: |
- Pages:
- 1
- 2
| Salary Sacrificing | |
|---|---|
| Topic Started: May 3 2010, 09:43:19 PM (4,362 Views) | |
| canaussie | May 3 2010, 09:43:19 PM Post #1 |
True Blue Mate
|
Just started a job 3 weeks ago with Queensland Health and we have been offered salary sacrificing to go towards different things ie. lease a car, pay bills, mortgage/rent, holiday etc. Hubby and I worked out the numbers based on my salary, we didn't think I would really save too much by salary sacrificing, so we opted not to get involved. Anybody do salary sacrificing? |
|
Paula (dual Canadian/Australian) married to an Aussie since 1999 and mummy to an Aussie since 2000 | |
 |
 
|
| chocopaws | May 3 2010, 09:44:57 PM Post #2 |
True Blue Mate
|
I've been curious about this, as well. I've been looking in to buying a new car... but not sure if it will be beneficial. I'm not even sure how to calculate the numbers, to be honest. |
|
|
|
| Lisa66 | May 3 2010, 10:46:00 PM Post #3 |
|
True Blue Mate
|
I work for World Vision, so we have the option to "package" a portion of our salary (i.e. is isn't taxed) - is that the same as your option in health orgs? I package the full amount and it goes towards our rent. It's $ we pay anyway, so might as well take it pre-tax. And, no admin hassle - it still gets deposited into our ANZ account since that is the account from which we autopay our rent. Plus I do some pre-tax $ / pay towards meals entertainment (for which I have a special ANZ visa card). The tax savings REALLY do add up, for me at least. |
|
|
|
| blarg | May 3 2010, 10:51:01 PM Post #4 |
|
True Blue Mate
|
My partner works for a salary packaging company on their health team. Got any questions I can pass along? |
|
|
|
| sheowahya | May 3 2010, 10:57:16 PM Post #5 |
|
True Blue Mate
|
Salary sacrificing is a great way to cut your tax bill and still have your expenses covered. The most common items included in a salary sacrificing package are: Superannuation car payments child payments (child care, school fees, etc) regular expenses (utilities, etc) loan payments (mortgage, share purchase, etc) expenses for property (think investment rental property expenses) items for work (clothing, computer, PDAs, briefcase, tools of trade, etc) Some of these items are exempt from FBT and some are subject to FBT (FBT = fringe benefits tax, a tax your employer will pay on taxable benefits provided to you) Salary sacrificed super becomes a deductible expense to your employer (either they expense your salary, or they expense the super you gain from the salary sacrifice, same diff) Your employer will withhold tax on the reduced amount of salary. For example: if your normal salary is $5,000/month and you have no salary sacrifice agreement, then your employer will withhold $1,057 and give you net pay of $3,943 at the end of the year, you will receive a wage statement that says you earned $60,000 and paid $12,684 in tax however, now assume that you salary sacrifice $1,000/month your monthly salary will now be $4,000 and your withholding will be $724 leaving you $3,276 at the end of the year you have earned $48,000 and paid $8,688 in tax now, on the surface this may not sound like a lot, but keep in mind that at $60,000 you are NOT eligible for any of the $1200 for the low income tax offset, but at $48,000 the government pays $480 of your tax bill... the lower you can get your taxable income the more the government will kick in... max is $1200 which starts at $30,000 Do you have a HECS debt? the higher your income the MORE HECS you will have to re-pay... use salary sacrificing to keep your income low enough and you won't have to pay ANY HECS payments Salary sacrificing is an AWESOME tool, and I have clients who get the benefit of a six figure salary and yet get a wage statement for less than $50,000. I STRONGLY suggest that you seek the advice of a tax advisor and see what salary sacrifice package will benefit you the most. If you have an employer that is willing to do this, (not all are) then by all means TAKE ADVANTAGE OF IT!!! The ATO has an excellent comparison of the various scenarios for a car scenario. You can see it here... ATO Salary Sacrifice comparison See how using the proper salary sacrifice arrangement can leave you with MORE money in your pocket? I hope this helps. Cheers, Marilyn |
|
My Timeline ========= Category 136 BN - Skilled Independent. Skills Assessment: Applied ICAA: 13May05 Approved as Accountant 2211-11: 26Feb07 Main Visa Application: Sent to ASPC: 12Mar07 VISA Approved: 07Nov07 Main move to Australia: 17Apr08 Citizenship Application: Applied: 17Apr12 Appointment: 7May12 | |
|
|
|
| canaussie | May 3 2010, 11:10:53 PM Post #6 |
|
True Blue Mate
|
This is all so confusing  I get the idea behind salary sacrificing and I understand what it can do. As I said hubby and I sat down and worked out the numbers and throw in the fees to the company doing it, it looked like I would only save about $1500 a year. Yeah its $1500 but I honestly didn't think it was worth it. I don't know if doing it will bring me into a lower tax bracket or not either. Plus for some reason I just feel like I want 'control' of my money and not have X amt going to a third company....probably stupid, but thats how I feel/felt. I am on a maximum of approximately $9000/yr as how much I can salary sacrifice as well. I dunno  |
|
Paula (dual Canadian/Australian) married to an Aussie since 1999 and mummy to an Aussie since 2000 | |
|
|
|
| blarg | May 3 2010, 11:13:08 PM Post #7 |
|
True Blue Mate
|
How do they let you claim your salary sacrificed amount? The company my partner works for gives you a debit card that you just use like any other debit card. Sounds pretty easy. Edit: Hey, why not just call the salary sacrificing company and let them give you their sales pitch? Give them the numbers at see if they can convince you it's worth it. If not, then you know. Edited by blarg, May 3 2010, 11:14:09 PM.
|
|
|
|
| canaussie | May 3 2010, 11:17:16 PM Post #8 |
|
True Blue Mate
|
No, there is no debit card involved with this mob. From my understanding, they take the money, must put it in an account and I would tell them what bills I want paid out of it and provide them with the info to do so. Does your partner's company have a fee for this? The one Queensland Health deals with has a fee of $12 per pay to provide this service. |
|
Paula (dual Canadian/Australian) married to an Aussie since 1999 and mummy to an Aussie since 2000 | |
|
|
|
| blarg | May 3 2010, 11:24:18 PM Post #9 |
|
True Blue Mate
|
Yes, they do, and it's way cheaper than that. |
|
|
|
| Bindie | May 3 2010, 11:40:34 PM Post #10 |
True Blue Mate
|
I salary sacrifce as well. Where I work we can claim the whole amount ($16,000) and there are no fees. It just gets deposited into our account tax free and I just have to show proof that we spend that much a month - which I do in rent alone. It's awesome. I save about $200 a f/n. However, the part about the HECS thing, that's not always true. My huz salary sacrificed for just a short time (because his job is stupid instead of showing the salary sacrifce amount on his pay, they make it look like he made like... $13 an hour) and he ended up having to PAY his HECS debt as it pushed his income up over the limit. Remember, it's on your grossed up income, not your "real" income. We're having to pay back $2000 to the tax office. It was ouchies. |
 The future is no place/to place your better days, DMB Canberra, ACT since 2004 | |
|
|
|
| chocopaws | May 4 2010, 09:42:24 AM Post #11 |
|
True Blue Mate
|
Marilyn - that was a great little tutorial for me. Thanks for breaking it down into simpler terms! My company only allows novated leases, but that's better than nothing, right? I'll have to actually sit down and crunch the numbers... especially when it gets closer to the time we buy our car. 
|
|
|
|
| janders1957 | May 10 2010, 08:08:19 AM Post #12 |
True Blue Mate
|
This salary sacrificing, my wife's never heard of it. Is it a Queensland only benefit, or does anyone know if this is available in NSW too? |
|
|
|
| Bindie | May 10 2010, 07:08:13 PM Post #13 |
|
True Blue Mate
|
It's available everywhere. In my experience it's often in the private sector and/or healthcare. |
|
The future is no place/to place your better days, DMB Canberra, ACT since 2004 | |
|
|
|
| Mimishuze | May 11 2010, 12:34:34 AM Post #14 |
True Blue Mate
|
Is this the same as LAFHA? ~Mimi |
| Gone On a Lucky Country - My Blog About Moving to Australia | |
|
|
|
| blarg | May 11 2010, 07:29:31 PM Post #15 |
|
True Blue Mate
|
No. Salary Sacrificing allows you to take pre-tax dollars and dedicate them to specific things like car leases, or depending on your profession, even general living expenses. Of course they make it highly confusing, and then introduce a new tax (called Fringe Benefits Tax or FBT) which has its own financial year to tax you on the money depending on your circumstances. It can be very worthwhile for some people, but it really depends on your situation and if your employer even offers it. |
|
|
|
| surfermomkelly | May 18 2010, 11:55:16 PM Post #16 |
|
True Blue Mate
|
My husband does this and puts the max in he can. Our accountant said for us because of what he makes its a good idea to max it out. |
|
|
|
| Bindie | May 20 2010, 09:44:21 PM Post #17 |
|
True Blue Mate
|
Hmmm. Well there you go. I was (mistakenly) under the impression salary sacrifice was offered to ppl in low paying positions - the health and community sector for example - to offset the difference in pay. Did anyone hear rumours about the govt stopping salary sacrifice?? |
|
The future is no place/to place your better days, DMB Canberra, ACT since 2004 | |
|
|
|
| canaussie | May 20 2010, 10:20:00 PM Post #18 |
|
True Blue Mate
|
Interesting. It never occurred to me that it was only low (or high) paying jobs that did salary sacrificing. I make more than my husband and he isn't offered salary sacrificing. What do you consider low paying? Also as a RN, I don't think I'm getting a low wage, I was making about $12,000 less at home....so I think I'm doing pretty good here. Haven't heard anything about it being stopped. Edited by canaussie, May 20 2010, 10:21:23 PM.
|
|
Paula (dual Canadian/Australian) married to an Aussie since 1999 and mummy to an Aussie since 2000 | |
|
|
|
| Bindie | May 20 2010, 10:44:54 PM Post #19 |
|
True Blue Mate
|
When I worked in HR for 2 separate aged care facilities Salary Packaging was used to help offset the low pay that those who worked there received. Most AINs make less than $20 an hour. I just assumed (mistakening as I said) that this was the case across the board. |
|
The future is no place/to place your better days, DMB Canberra, ACT since 2004 | |
|
|
|
| surfermomkelly | May 21 2010, 10:23:52 PM Post #20 |
|
True Blue Mate
|
If you are under 50 you can do 25K if you are 50 or over (which he just turned 50) you can do 50K, they just changed it too recently I think it was more. And that is with company matching, I'm not sure what his matches. It helps make our income go down so we dump it all in there for taxes. |
|
|
|
| Go to Next Page | |
| « Previous Topic · "How Do I...?" · Next Topic » |
- Pages:
- 1
- 2
5:12 PM May 22