Salary Packaging is a way of reorganising your income to pay for certain benefits out of your pre tax to reduce the amount of tax that you pay, resulting in your taking home more pay.

Approved by the Australian Tax Office (ATO), Salary Packaging means you can pay certain expenses out of your salary before you pay tax. This means the tax you pay is calculated on your reduced income after the nominated expenses are paid.

A carefully calculated amount, based on the benefits you are entitled to, is deducted from your taxable income and moved to a trust account (managed by an Administrator). The tax you pay is then assessed on your reduced taxable income after the deduction, lowering the tax you pay.

You initially pay for the expenses up front and are then reimbursed for your selected Salary Packaging items using the funds from your Salary Packaging account.

Salary Packaging enables you to save money when you buy a car through a Novated or utilise your second hand car at home with an Associate Lease.

Depending upon your employer and the industry you work in, you may also be able to pay for a range of everyday items or expenses using your pre-tax dollars e.g. your electricity bill, utility accounts, home mortgage or rental repayments and many more.

There can be significant financial benefits when Salary Packaging, however it does depend upon the person’s individual situation and the benefit varies from person to person.

A carefully calculated amount, based on the benefits you are entitled to, is deducted from your taxable income and moved to a trust account (managed by NSP). The tax you pay is then assessed on your reduced taxable income after the deduction, lowering the tax you pay.

A NSP specialist will run the calculations and determine the correct amount to be packaged so that you are maximising your Salary Packaging benefits.

All employers can offer salary packaging to their employees. Giving them access to various benefits depending on both the company’s FBT status and also their company policy.

Depending on your companies FBT Status and company policy, will determine what you can salary package.

For example, a not for profit, (PBI) that has a full FBT exempt status will have access to the below benefits PLUS additional benefits.

Click here to see the CAP benefits.

Corporate organisations will have access to:

1. Novated leases
2. Associate leases
3. Portable electronic devices
4. Remote area benefits
5. Tools of trade