What is Salary Sacrifice?
In order to reduce the amount of income tax that you pay, salary sacrificing is an arrangement where you agree to forgo part of your salary in return for receiving benefits of a similar value. The benefits can be in the form of employer-provided goods and services or contributions to your superannuation. Salary sacrifice is optional, it totally depends on the will of employees. It’s not compulsory to sacrifice your salary. Salary sacrificing is a complex arrangement and involves a lot of rules and regulations. So, we need to know how it works.
What is Salary Sacrifice and How Does It Work?
Salary Sacrifice is a setup where an employee agrees to take less salary in return for benefits provided by their employer. This happens with an agreement between the employee and the employer. The benefits can be in the form of employer-provided goods and services or contributions to your superannuation. Salary sacrifice helps in providing the benefit of less taxes.