WHAT IS SALARY PACKAGING AND WHY SHOULD I DO IT?
Pay less tax and enjoy more spending money
You may have heard people talking about salary packaging and even when they try to explain how it works, it might all seem quite complicated and perhaps even a little too good to be true.
Does the ATO really allow you to pay for some everyday items using pre-tax income? Yes they do. It’s 100% true.
As a full-time, part-time or casual employee of the Government of South Australia, you are entitled to pay for certain expenses – which may include car repayments, work-related laptops, tablet, self education, disability and income protection insurance and, subject to your employer, mortgage and rent payments – with your pre-tax salary. This reduces your taxable income, meaning you could pay less tax and increase your disposable income.
Your department or agency will offer a range of benefits you can access if you choose to salary package some of your income. And contrary to popular belief, you don’t have to be a big earner to benefit – if you pay income tax, you could save tax and boost your take home pay.