How Salary Sacrificing Can Help Save Tax in Australia


 

We receive many queries from our clients on tax saving tips. In this blog KPG TAXATION Hobart has compiled how Salary Sacrificing can help save tax in Australia.

Highlights:

  • Fringe benefits

  • Limit on salary sacrifice

Residents of Hobart trying to learn how to save tax in Australia, salary sacrificing is one way to do it. This is also called “salary packaging,” and it works a few different ways. With salary sacrificing, a taxpayer would put some of their pre-tax income toward a benefit before they are taxed. Some of the most common salary sacrifice benefits are motor vehicles and superannuation.

Fringe benefits

So, an employee would forgo part of their pre-tax paycheck before they get it. For example, they could use salary sacrificing to pay for a new car, computer, insurance, rent payments, mortgage payments, and other benefits. These benefits are also referred to as “fringe benefits,” and they can save Australians thousands of dollars in taxes every year, with a few exceptions. KPG TAXATION tax Accountants in Hobart branch thinks this is one of the best way to save money from tax legally.

If you are living in Australia and looking for more tax saving tips, or tax Accountants to handle your accounts, feel free to visit KPG TAXATION office in Hobart.

Limit on salary sacrifice

For one thing, there is a limit on what can be salary sacrificed, also called salary packaged. Also, Fringe Benefits Tax, or FBT, can impact the types of benefits your employer offers. For example, employers will offer to salary package a car as a novated lease. This is an agreement between your employer, you, and a financer, and is one way to get access to a new car while reducing your taxable income. If you want to increase your refund this year, you could also consider salary packaging your superannuation too. Keep Accurate Tax and Financial Records.

There are more ways to save your hard earned money legally, KPG tax agents have the expertise in it.

Contact us today for Accounting, bookkeeping, tax lodgement, Company set up related services. For residents of Hobart, KPG has built its footings in your neighbourhood! Visit us today.

Location: Hobart TAS 7000, Australia

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