brookkat

a tad confused!! in with the offer job offer/conditions of employment etc that i've had was a thing on salary packaging. Even after reading through the document i'm still no clearer on what it actually is and whether i want to agree to it. can anyone shed some light???

Ozzidoc

Say the job is worth a total of 100K. This is comprised of superannuation, salary, and then the opportunity to get "other things" which come out of your pre-tax dollars.

worzel

It is about paying things out of pre-tax earnings so that you save tax at your top level on it. So if you salary sacrifce super (say) of 10K per year and pay tax at 30% top rate it saves you $3K.

Generally a third party gets involved in administering it.

Cars are the most complicated. You can buy a car this way or even sell an existing car into the scheme. The third party works out what you will pay on fuel, repairs, services etc plus the finance of the car and charges you a monthly amount (pre-tax). In return you free up capital, save tax, get a card for fuel, repairs etc so it is almost like having a leased car.

joho

I salary package my mortgage upto $9k a year, it means that it takes this out of you pay before paying any tax on it. The higher tax bracket you are in the more you will save.

Hubby is just getting a car through salary sacrifice, which will include his fuel, ins, rego, maintainence basically everything. This works in a similar way except the more mileage you do the better tax benefit. He does about 45000km a year and will benefit the most, It will cost about $2k out of his wages a month, but the net pay only changes by about $1000 factor in his monthly fuel bill of $600 and all the other bits we are not much worse off and he can have his mid-life crisis car. A mazda CX7.

Sorry meant to say that hubbies car is based on $42000

Jo

tabby

Does this mean when you sell your house you are liable for capital gains tax ??? curious as i've never heard of 'packing'

Thanks

Martin

ozzieeagle

My wife works as a nurse, Government Hospital employees have the broadest range of deductions. Currently she is able to claim any interest payments, Food and Entertainment, and a car if needs be. Conversely I work for Aussie post and all we can claim for are Laptop computers and PDA's. Basically what it means, is the payments are made to the lenders by an administrator pre tax, which for us basically means a pretax saving of 40cents in the dollar on that amount. We claim a line of credit, food and entertainment, which works out about 1100 bucks per month of my wifes taxable income, giving us a net gain of circa 500 bucks per month. You save whatever tax rate your deductions and threshold are at, at the point of payment.

joho

I also work for a hospital. These are one of the few that can package bills and each state has its own threshold. NSW is $9k but Queensland I believe is about $16k and no we dont have to pay capital gains, but we do have to declare it in our tax returns as a fringe benefit.

Jo

worzel

I overhead a conversation (Perth) between two women recently, one works for the state government, one for the local council. They were comparing when they could claim for and were suggesting swapping receipts with each other as there were so many things they could salary sacrifice but each had different things on the list. One of them claimed every time they went for a meal or bought a takeaway, even. I don't think the weekly shop or cases of beer were on the list but just about everything else.

joho

Well you can package your credit card, so if you stuck it on there you could package anything. Personnaly a mortgage statement once a year to the payroll office is easier than trying to figure all the rest out. Plus you have to pay and admin fee for each different claim, so I stick to one it more than reaches my $9k a year even half a year.:curse:

Jo