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What We OfferSuccess Stories"... It has been outstanding, and we sing your praises ... Rob and Jo from Bribe Island. "My experience with FAA is like working with a reliable partner..." Dr Pareek from Darwin.
"... we want people to know that you don't need to be wealthy to benefit from FAA's services." Craig and
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Salary Packaging:
What is salary packaging? Salary packaging is an Australian Tax Office (ATO) approved way of restructuring your income. It enables you to buy a range of everyday items out of your pre-tax salary rather than your after-tax salary – leaving more money in your back pocket every pay day. Salary packaging is a proven legal method of increasing your net pay. What can you salary package? Salary Packaging is a tax effective option that enables you to save money when you buy a car through a Novated Lease, pay your electricity bill, pay utility accounts, and make home mortgage or rental repayments and many more benefits approved by your employer. Over the past ten years we have seen a huge growth in the number of people looking to salary sacrifice in to their Superannuation as salary packaging contributions can very quickly add up to tens of thousands of extra dollars at retirement. Why should you salary package? By effectively salary packaging it allows you to reduce your annual tax payable and allows you to pay for every day goods and services at zero risk to your employer with payments coming out before you pay tax on your salary. In nearly every person’s case there are financial benefits that come from Salary Packaging. Don’t be one of the few that miss out on this opportunity. How does it work? You request a carefully calculated amount to be deducted from your taxable income and moved into a trust account, (an Administrator). Financial Advisers Australia are experts and are aware of the maximum amounts which you can package. These funds in your trust account become tax-free and can be used to pay for a variety of different expenses, such as a Novated Lease, Rent/Mortgage, Electricity and various others depending on your employee status. Financial Advisers Australia staff a have high knowledge on what each employee can and cannot package. From here, your income tax is calculated on the amount of your salary after these deductions have been taken into consideration- lowering the tax you pay! What is an Employee Status? Each employee has been given an employee status for Salary Packaging relating to Fringe Benefits Tax. This is because we all have different employers and each employer will allow different benefits for their employees. Several benefits are exempt from Fringe Benefits Tax, (FBT). In Salary Packaging, these are often referred to as an ‘exempt benefit.’ Exempt benefits are exempt from FBT and they may also be exempt from income tax by Salary Packaging. Private companies may not even be aware of this or aware that they can even offer this. An example: On 1 July 2011, the local Hospital employed Jane and Jack. Jane and Jack are both earning $55,000 a year and pay $18,000 per year in rent. Jane then Salary Packaged $9,000 of her gross income towards her rent. Jack did not Salary Package any of his salary.
As you can see even though both Jane and Jack earn the same income, Jane has an additional $54.52 per week or $2,835 per year in her pocket. What would you be able to do with a $2,835 “pay rise”? You are probably wondering: - How do I get started? - Who much will it cost me? - What can I package? To discuss your employee status or information about what you can and cannot Salary Package click here and we will be able to assist you with any queries. Prepared by John Hehir - Financial Advisers Australia (FAA) |
