Salary Packaging is an arrangement that allows an employer to pay their employee in a flexible way through a combination of wages and Australian Tax Office (ATO) approved non-cash Benefits (NCB). Through this arrangement, the employee agrees to forego part of their “cash” wages in exchange for some NCB’s of a similar value.
The result is that the employee receives a benefit paid by their pre-tax rather than their post-tax salary thereby reducing the amount of income tax payable.
Non-Profit organisations commonly offer a Salary Packaging arrangement to their employees as they have an enhanced benefit available due to the ATO approved concessional Fringe Benefits Tax (FBT) treatment.
If you’d rather talk to us about Salary Packaging, please give us a call on 03 5229 4200 or send us your details by clicking here and we’ll give you a call.