Casual salary packaging

I recently got a new casual job paying $45 per hour that offers salary packaging. However, as I don't anticipate working many shifts this year (maybe only 100 hours or so), I'm not sure if the fees (3.5% per pay + upfront $25 annual fee) make it worth the tax benefits and I'm not too sure how to do the maths. Any ideas?

Comments

  • -1 vote

    Usually you can nominate a lesser amount to salary package than the maximum. So you could nominate $4500pa.
    Then in the pay periods where you don’t work or don’t earn as much you can let them know and they carry the amount forward.
    They usually need about 10 days notice to change things if it’s a fortnightly pay period.
    It’s worth doing cos if you only plan to earn $4500/year it will all be tax free.

  •  

    Assuming you aren’t with an FBT concessional employer, the biggest wins for an office worker would be the likes of a briefcase or a portable electronic device. But those must be at least 50% business use, so you’d have to be able to demonstrate use in another job too.

    https://www.ato.gov.au/General/Fringe-benefits-tax-(FBT)/FBT-exemptions-and-concessions/Work-related-items-exempt-from-FBT/

    Edit: above is assuming this is a side gig. If this is your only income there’s no point at all.

  •  

    Thanks for the replies. This will be a side gig with an FBT concessional employer (though I'm not paying rent/mortgage this year). My other job is on a casual basis too, and I'd most likely be looking at the 19% tax bracket.

    •  

      That’s a bit different then. Talk to them and find out if they are an FBT rebatable or exempt employer. If they are rebatable, probably not worth doing anything at 19% marginal rate less 3.5% admin.

      If they are exempt, then yes it’s worthwhile as you’d be paying for whatever you salary sacrifice out of your pre-tax dollars (19%-3.5%). It can be pretty much anything (groceries, bills clothing etc).

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