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| *Ostroff, Fair and Company>>>Australia Taxes |
I WANT TO KNOW ABOUT SALARY SACRIFICE? |
i WOULD LIKE TO KNOW MORE ABOUT SALARY SACRIFICE BEFORE I COMMITT TO THIS IT DOES SOUND INTERESTING AND IF I EARN $810 PLUS HOW MUCH WOULD I SAVE IF COMMITTED 150 PER WEEK WHAT WOULD MY SAVING BE AND HOW MUCH EXTRA WOULD I END UP WITH IN MY PAY how many hours and the over time do you earn and so but it can be depending on how much you make a month I used to have SS, I basically didnt have topay tax on a portion of my wages as long as I used it for certain things. I could pay of a mortgage, pay of a car loan, pay school fees etc. But certain things werent allowed, for instance I couldnt use it pay of my investment property mortgage You need a professional to set it up for you, they will be able to tell you whats allowed, You can also cancel it at any time you like The beauty of salary sacrifice is that the employer pays the tax for you. It's called the fringe benefits tax and australia and new zealand are about the only countries with this system that tax the employer and not the employee. Generally you get the money invested into maybe a company car or the likes, if you just save it up and get it in bulk you still pay tax on it. Talk to your super fund, union or investment institution about it As with many things, it all depends. Many people (including myself) use salary sacrificing to purchase a car. There are a number of tax benefits, but you still have to be careful as you will have to pay Fringe Benefits Tax. Although as a previous respondent said technically your employer pays this, it would be very unusual for them not to pass this cost onto you. For cars, the amount of FBT you pay depends upon the number of kilometres you travel in a year - the more you travel the less the FBT is (0-14999 kms - 26%, 15000-24999 kms - 20%, 25000-39999 kms - 11%, 40000 & over - 7%). Generally speaking, for many people if you are likely to travel less than 15,000 kms the benefit is marginal at best. If you are not purchasing a car, the only items that are FBT free are laptops, mobile phones, PDAs and briefcases. For any other item there is essentailly no tax benefit (as I understand it). The best advice is to talk to a professional - there are a number of companies that specialise in Salary Sacrificing. Just do a search on the internet and you should find one. |
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