How do I make sure I do not end up with a shortfall at tax time for unpaid HECS-HELP repayments?
Salary packaging could reduce your taxable income but may affect the way the ATO calculates your HECS-HELP repayments – which could leave you with a tax bill at tax time. So your employer may not be taking out enough HECS-HELP repayments or in some cases, may not be deducting any HECS-HELP repayments at all.
To avoid a possible shortfall at tax time for unpaid HELP repayments, you need to let your payroll department know when you start salary packaging as they may need to increase or recommence the amount of your withholding tax deductions.
While each employer is different, in most cases your payroll department will be able to help you manage the process and changing your HECS-HELP repayments is quite simple to do. Your payroll department may have its own form or they may ask you to use the ATO's form Tax declaration form or Withholding tax form. Check with your payroll department first.
This is quite simple to do and in most cases your payroll department will be able to help you manage the process.