minkyme29

Salary sacrificing - explaination please?

    Recommended Posts

    Hi everyone

     

    I'm sorry to ask this as I know it has been mentioned on PIA many, many times but I can't find the info at the moment. Can someone explain 'salary sacrificing' to me...am intrigued by the benefits if there are any...:wacko:

     

    thanks

    Dette :)

    Share this post


    Link to post
    Share on other sites
    Guest Django

    Its basically a tax dodge. Some jobs allow you to pay household expenses to a set limit before tax. ie, you get paid then a deduction is made to go towards these expenses. You are then only taxed on your remaining pay.:unsure: I think thats right.

    Share this post


    Link to post
    Share on other sites
    Guest Martin and Val

    We use Val's for our rent, we could have used it on a mortgage, loan, Visa card etc. The payment is made to whoever before you get your wages and also before you pay any tax therefore you are taxed on a lot less income.

    Hope this helps but I sure somebody else can give you a lot more of a tech answer.

    Martin

    Share this post


    Link to post
    Share on other sites

    Thanks for your help...so am I getting this right...the employee has immediate access to the salary sacrificed? Or is it taken by your employer and put into a safe place for later on?

    Share this post


    Link to post
    Share on other sites
    Guest stufi1997

    Hi Dette,

    As always Pete's right,I do it...and it seems to work really well, mind you haven't got to the end of the tax year yet. Here's how it works for me. You get your top line on your pay slip, they deduct your allowed limit (depends on the company you work for) mine is $617 per fortnight and it gets paid to another company (CBB), then tax your pay, then add your extra benefits like travel allowance etc, out of the sacrificed money, CBB take $11 for managing my money, they pay our rent then what's left over gets put into a credit card which i can use to buy anything, just not allowed to take cash out. cheers Fiona xx

    Share this post


    Link to post
    Share on other sites

    Thanks Fiona...that sounds pretty good to me, anything to keep it from the tax man! Have seen part time work with Uniting Care Wesley and they offer salary sacrificing...lots to ponder on now.

    Share this post


    Link to post
    Share on other sites

    salary sacrife is a great perk to have if your lucky enough to work for an employer who has it. I also get $617 a fortnight allowance. But to give u an example say u earn $50k a year, and your allowance is $16k, they take off the 16k then tax u on the rest. For me it means i get around $200 a fortnight more in my pay. I also ontop can get an entertainment card so i put $25 a fortnight onto this also tax free which pays for coffees etc or save it up and have a meal now and again all tax fre!! Its easy to set up and i nominated my mortgage but the money goes ito my bank account the day after pay day so its pretty straighforward. Some companies have restrictions on what u can sacrifice towards, hope this helps and congratz on the job x

    Share this post


    Link to post
    Share on other sites

    Thanks to all of you for your help...and to Claire who's explained it very well...certainly sounds beneficial.

     

    I haven't yet got a job but have been looking into the feasibility of jobs with Uniting Care Wesley who offer salary sacrificing. I'm in the very early stages of researching this as I need to earn something and eventually want to retrain in counselling or psychology so think working for an organization like that will be great experience.

     

    thanks again

    Dette :)

    Share this post


    Link to post
    Share on other sites

    Create an account or sign in to comment

    You need to be a member in order to leave a comment

    Create an account

    Sign up for a new account in our community. It's easy!

    Register a new account

    Sign in

    Already have an account? Sign in here.

    Sign In Now