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| Salary Sacrificing | |
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| Topic Started: May 3 2010, 09:43:19 PM (4,363 Views) | |
| canaussie | May 22 2010, 08:49:10 AM Post #21 |
True Blue Mate
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But that amount may be for people who are employees of that specific employer, but it is not the same for everyone. I work for Queensland Health, so a government department and the max any of us can put in this year is $9300. So HUGE difference here. |
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Paula (dual Canadian/Australian) married to an Aussie since 1999 and mummy to an Aussie since 2000 | |
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| blarg | May 22 2010, 08:54:59 PM Post #22 |
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True Blue Mate
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It's all incredibly complicated. It's as if the ATO wanted to give people nice things and then realised they could tax it all a different way (yay FBT!). So it's massively complicated and depends on your employer, who they use to package the salary, what industry you're in, what they're willing to do.... Basically every case is different. |
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| meg1388 | Nov 1 2010, 07:47:46 PM Post #23 |
True Blue Mate
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So I'm working for a branch of WA Dept of Health - and we are offered salary sacrificing... which basically sounds too good to be true! Especially if you use it for things you KNOW you will have to pay like rent  My question is how does salary sacrificing affect our tax returns (if at all) for the US? I'm a little lost with this -- i'm no tax expert but I would imagine that the IRS would want to get their chunk in tax if they see that we are earning taxable income without paying any tax in Australia... is this a realistic concern? 
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| Bindie | Nov 2 2010, 09:21:47 PM Post #24 |
True Blue Mate
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I've been doing salary sacrifice for nearly 6 years and I haven't had any issues with the US gov questioning my taxes. I think most of us are waiting for Marilyn to answer this question for you - she's our tax expert! ET correct of sucktacular grammar. gawd. Edited by Bindie, Nov 3 2010, 10:42:42 PM.
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 The future is no place/to place your better days, DMB Canberra, ACT since 2004 | |
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| meg1388 | Nov 3 2010, 08:34:23 PM Post #25 |
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True Blue Mate
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Thanks Bindie - that sounds good to me! Signing up tomorrow! |
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| DJLJ | Mar 18 2011, 01:11:54 AM Post #26 |
Piker
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Hi. I just read your postings on Salary Sacrifice... is this similar to 'Salary Packaging?' I too got offered a job in a public sector/hospital in Victoria and I'm very interested on salary packaging. I'm curious to know if "rental and relocation expenses" are also included. Do you know of any website/link that specifies inclusion of Salary Sacrifice? Thank you very much.
Edited by DJLJ, Mar 20 2011, 02:45:24 AM.
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| yaussievi | Mar 18 2011, 09:52:05 AM Post #27 |
True Blue Mate
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I work for a not for profit so salaray sacrifice is one of our benefits. I salary sacrifice towards my mortgage and find it to be a huge benefit when we crunched the numbers... 
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| Yaussie-Vi | |
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| Ausson | Apr 28 2011, 12:02:55 PM Post #28 |
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True Blue Mate
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I'm getting LAFHA at the moment, and based on qualifying for that I have also been able to qualify for Remote Area Holiday Transport. You can find what I'm referencing in Section 19 of the FBT Guide for Employers http://law.ato.gov.au/atolaw/view.htm?DocID=SAV%2FFBTGEMP3%2F00020 Because I'm located in Canberra I am not considered to be living in an remote area, but it means that I can deduct 50% of the cost of one visit home (or a visit to me by a family member). Since arriving in May my husband has visited us here, my father has returned to the US and come back again, and my mother in law (who is a member of my US household) has visited. I will have to read the ATO guide to salary sacrificing to see what the FBT is on the stuff that you can use the money for. I know that I've calculated that purchasing a car on a novated lease is only a good idea for a car around $20k, because I just don't do the km's to get a good FBT rate. |
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| sheowahya | Dec 2 2011, 09:52:37 PM Post #29 |
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True Blue Mate
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I am posting this in a few places because LAFHA is so popular... Check with your employer first!! The rules are changing as of 1 July 2012 and a LOT of people will no longer be able to take advantage of the tax savings of LAFHA. Excerpt from the mini-budget just released... Effective from 1 July 2012, access to the tax exemption for temporary residents will ONLY be made available if the employee maintains a residence for their own use IN AUSTRALIA and are living away from that home as a result of work. Expenditure beyond the statutory amount on food and accommodation will need to be subtantiated. A consultation process will be conducted between now and the start date so that transitional arrangements can be implemented. Mini Budget announcement The ATO has already started asking employers to provide information on employees claiming LAFHA. As would be expected, they have started with the largest companies, but will eventually contact the majority of employers with LAFHA benefits on their FBT returns. ATO review notice These new measures are estimated to save Australians almost $710m over the next 4 years. Cheers, Marilyn |
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My Timeline ========= Category 136 BN - Skilled Independent. Skills Assessment: Applied ICAA: 13May05 Approved as Accountant 2211-11: 26Feb07 Main Visa Application: Sent to ASPC: 12Mar07 VISA Approved: 07Nov07 Main move to Australia: 17Apr08 Citizenship Application: Applied: 17Apr12 Appointment: 7May12 | |
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| sheowahya | Dec 3 2011, 11:50:39 AM Post #30 |
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True Blue Mate
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It is a realistic concern. Eventually (with all the new legislation being worked on in the US that specifically targets expats) they will catch on to some of the wonderful tax schemes in various countries, like salary sacrificing here in Australia. It has already started here in Australia. It use to be that you could SS into super and it wasn't reported anywhere and the only effect was reduced tax bill. Now your employer has to report SS super on your group certificate and it gets entered into the "income tests" section of your tax return and the SS is ADDED onto your income for certain calculations (thankfully not the tax calculation yet, but I'm sure that if the economy turns bad enough they'll change that law). Is there an issue with TODAY's US tax returns? NO! take the gross earned each pay period, convert it to US$, add it all up for the year and report that on your Form 1040. I'm doing my very best to keep up on the tax changes as they apply to us expats and will post things as they come to my notice. Please do not depend on me as your sole source of information, but I will do my best. cheers, Marilyn |
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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 | |
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| sheowahya | Dec 3 2011, 12:17:11 PM Post #31 |
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True Blue Mate
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As a follow up to the topic of SS and super... Keep an eye on the contributions your superfund receives in a tax year (1 July - 30 June). Your superfund is only allowed (by law) to receive a certain amount of contributions on your behalf each year. (yes there are ways to add more, but they do not involve work for wages and salary sacrificing, hence that is a different topic) As mentioned above you are limited to either 25,000 or 50,000 in contributions each year. This limit includes your employers SGA (superannuation guaranteed amounts) and your salary sacrifice amounts. But it goes by the date that the contribution is received by your fund!!! Hence if last year your employer didn't send the payment for the June liability until July 1 it would be received in July. Then if your employer sends the June payment for that year early enough in June that your fund receives it in June (easy peasy with electronic transfers) you have effectively received 13 months of contributions in one year. If you SS to get up to your max contribution limit, this extra month will put you over and you will have to pay super contributions excess tax of almost 50%. Yes, you can lodge forms and get your super to release the funds to you, but you will have to pay the tax out of your pocket first to meet the time deadline set by the ATO. The superfund will reimburse you. HOWEVER, (why is there always a but or a however in taxes? why can't it just be simple and be ONE rule for EVERYONE all the time? LOL) there is legislation in the works under the MySuper reforms package that would allow you to apply to your superfund to return all of the excess contributions to you, thus returning your contributions to the limited amount for the year and avoiding the excess super contributions tax. HOWEVER, by getting this money refunded to you, it becomes part of your normal assessable income as though it were your gross income... no tax has been paid on it and you will include it with your other income when preparing your tax return. I have prepared DOZENS of objection forms for clients this year, and not a single one of them has met the tax commissioners criteria for "out of taxpayer control" for excess contributions. If you are ss'ing to super and are that close to your max limit, make sure your check your super account monthly and keep track of contributions received and adjust the May/June ss amounts if necessary. cheers Marilyn |
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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 | |
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5:15 PM May 22