Salary packaging is an ATO approved way of paying for certain items before you pay income tax. The result is that you pay less income tax and increase your take-home pay.
In Australia, the Australian Tax Office (ATO) sets guidelines for what can be included in a salary packaging arrangement. Some of the most common benefits that can be salary packaged include:
Meal and entertainment expenses
Housing and rent expenses
Vehicle expenses, such as servicing or car lease payments
Loan and Credit card payments
It's important to note that some benefits may be subject to Fringe Benefits Tax (FBT) and that there are limits and restrictions on the type and amount of benefits that can be salary packaged. It's best to consult with a financial advisor or tax professional to determine the best salary packaging options for your individual circumstances.
The amount you can salary package depends on a variety of factors, including the type of employer you work for, the specific benefits you choose to include in your salary packaging and the Fringe Benefits Tax (FBT) year, which runs from April 1st to March 31st.
A capped benefits refers to the Fringe Benefits Tax (FBT) exemption that is available to certain employer types, which allows employees to salary package certain benefits (such as living expenses, mortgage, rent, credit card payments, utility bills and groceries) up to a set limit without paying FBT.
They essentially provide employees with the opportunity to reduce their taxable income by directing a portion of their salary into certain expenses, all while enjoying a set limit on the amount they can salary package without having to pay FBT. This results in a higher take-home pay for employees and more disposable income!
Cap limits refer to the total amount that employees can salary package for certain benefits without having to pay Fringe Benefits Tax (FBT). These limits vary based on the type of employer an employee works for.
There are three different types of employers:
Health Employees (Public Hospitals, Ambulance Services): These individuals have the option to salary package up to $9,010 for living expenses and up to $2,650 for meal entertainment.
Charities and Public Benevolent Institutions: Employees in this sector can choose to salary package up to $15,900 for living expenses and up to $2,650 for meal entertainment.
Private Education and Rebatable Employers: These employees are eligible to salary package up to $15,900 towards living expenses on a concessionally taxed basis, and up to $2,403 for meal entertainment on a concessionally taxed basis.
In addition to these capped limits, employees may also be able to salary package additional benefits, such as a novated lease for a vehicle, work-related expenses, and other benefits that do not attract FBT.
Salary packaging allows you to save on income tax that you would otherwise pay on a variety of everyday expenses. Salary packaging reduces your taxable income so that you pay less tax, resulting in an increase to your take-home pay and more money in your pocket!
To apply for salary packaging, simply click on the orange ‘Apply now’ button on the top right of this page and fill in your details - we will take care of the rest. It’s as simple as that!
Based on your employer and the benefits you select; you may need to provide some documents such as a valid a tax invoice and proof of payments to start packaging. Rest assured; we will be there every step of the way to guide you through the process.
Our team is here to make sure you have a seamless and enjoyable salary packaging experience. When setting up your package, we'll work with you to identify the most suitable method for claiming your benefits.
Ongoing/regular payments: This option is perfect if you have expenses that occur on a regular basis, such as mortgage/rent or utility bills. With this option, your payments will be taken care of automatically.
Salary Packaging Cards: This option allows you to have your salary packaging benefits loaded onto a card that you can use just like a regular debit or credit card. This is a great option for things like groceries or other everyday expenses.
Reimbursement: If you've already paid for an expense out of pocket, you can submit a reimbursement request to get your money back. This option is great for work-related expenses or other one-off costs.
We'll guide you through the options, ensuring you choose the best one for you, so you can relax and enjoy the benefits of salary packaging.
As salary packaging is a benefit provided to you by your employer, you will need to confirm with us or your organisation whether casual employees are eligible to salary package.
Fringe benefits tax (FBT)
FBT is a tax that your employer pays for the benefits provided to you in lieu of salary or wages. Depending on your employer type, you may be eligible for an FBT exemption which means you can salary package the costs of your general living expenses and Meal Entertainment up to a capped annual limit without incurring FBT. Please refer to the categories and benefits section of our website for more information on the types of expenses you can salary package and the limits that may apply.
No, the Fringe Benefits Tax year (FBT) runs from 1st of April to 31st of March. The FBT year refers to the time during which the employers calculate and report their fringe benefits and tax liabilities.
Yes, you can commence salary packaging at any time during the FBT year. If you are eligible to salary package under capped benefits, you can accelerate your savings to take full advantage of the year’s limit.
HELP/HECS student loans
A Study and Training Support Loan is a government loan aimed at alleviating the financial burden of education and training, facilitating individuals in pursuing their career goals and aspirations.
As of July 1st, 2019, all government study and training loans are governed by a single set of thresholds and rates. This includes Higher Education Loan Program (HELP), Vet Student Loan (VSL), Student Financial Supplement Scheme (SFSS), Student Start-up Loan (SSL), ABSTUDY Student Start-up Loan (ABSTUDY SSL) and Trade Support Loans (TSL).
Yes, you can still salary package even if you have a Study and Training Support Loan. However, it's important to keep in mind that salary packaging may affect your taxable income, which in turn could impact the amount you need to repay for your loan.
We can provide you with an estimate of your loan repayments and tax savings if you choose to salary package. It's important to note that the estimate for the extra tax amount relating to your Study and Training Support Loan is an estimate. This calculation is meant to help you minimize any tax liability you may have at the end of the financial year, but we cannot guarantee that a tax liability won't occur.
We always recommend that you seek independent tax and financial advice before making any decisions about salary packaging.
No, you will need to inform your employer/payroll department about any additional repayments you need to make towards your debt, based on the calculation provided by us.
Customer claims and accounts
You can view your FBT year to date payments and scheduled payments/remaining limit by simply logging into the online portal, MySalPack.
You can also contact our friendly team on 1300 408 046 or email [email protected].We’re here to help!
View your salary packaging statements and activity by logging into the online portal, MySalPack.
Yes, you can change your salary packaging arrangement, but we recommend speaking with our friendly team first. Our team will provide you with necessary information and guidance on how best to proceed based on your circumstances. Just give us a call on 1300 408 046 or email [email protected].
To claim your salary packaging benefits, you will need to provide us with evidence of the expense (tax invoice or statement). This can be done in three simple ways.
MySalPack Mobile App:
Download the MySalPack mobile app from the App Store or Google Play (available for both iOS and Android devices).
Were paid for while you were employed at current employer.
The expenses (if eligible) can be claimed.
To ensure compliance, we kindly ask for an itemized proof of payment, like a tax invoice or statement, for any benefit reimbursements.
Under the Meal Entertainment benefit allowance, you can claim all hotel, motel, and similar accommodation expenses. However, these can only be claimed after the holiday or accommodation has taken place.
Please submit your claims to your current salary packaging administrator before 28 February 2023 to ensure they are processed before the end of the FBT year (31 March 2023). From 1 March 2023, please hold on to your claims and submit them to SalaryPackagingPLUS from 1 April 2023.
Salary packaging cards
Salary packaging cards make managing your living expense and meal entertainment benefits effortless. These cards simplify the process of claiming expenses and allow you to enjoy the tax advantages of salary packaging without the need to provide evidence for each claim.
At SalaryPackagingPLUS, we have partnered with Beyond Bank to provide a VISA card specifically designed for covering living expenses and meal entertainment. This VISA card is loaded with a portion of your pre-tax salary, enabling you to conveniently use it for your everyday living expenses and dining needs. With this card, you can access your tax savings without the hassle of managing receipts or filing claims.
To find out more about our salary packaging cards and how they can benefit you please click here.
Using a salary packaging card is simple and easy. Here's a step-by-step breakdown of how the cards work:
You nominate a pre-tax deduction amount towards the card.
Your employer transfers us the pre-tax salary according to your salary packaging arrangement.
We put the money onto your card, so you can spend it on eligible expenses!
These cards enable you to take advantage of the tax savings offered by salary packaging without having to worry about managing receipts or making claims.
You don't have to worry about providing invoices for payments made using your Living Expenses/Meal Entertainment cards. These cards have been setup in accordance with ATO guidelines allowing you to conveniently spend your pre-tax salary on eligible purchases.
Any remaining balance on the card is simply rolled over into the new FBT year (1 April – 31 March). We recommend customers reduce their balances to zero by 31 March as any amount rolled over will decrease the amount you can salary package under the capped benefits in the new FBT year.
For example: If you have a $2,650 meal entertainment limit and you have a balance of $1,000 on the card when the FBT year rolls over, you can only package $1,650 onto your card in the new year. You don’t lose your money, just your tax savings.