Salary
sacrifice

The old saying goes: “You don’t miss what you don’t have.” The same can be said of the salary sacrifice solution.

While a personal contribution is adding extra to super from your take-home pay, salary sacrifice is a way to top up your super from your before-tax salary without the painful deduction from your bank account every month. Instead, this extra contribution is taken from your pay and put into your super.

Setting up a salary sacrifice scheme with your employer means your salary sacrifice contribution is paid out of your pre-tax salary directly into your super account. This means your taxable income is lowered, and the amounts sacrificed are not subject to pay as you go (PAYG) withholding tax, but instead will be taxed by your super fund.¹ This is generally lower than most people's personal tax rate which can be as high as 47%.²  

Contributions caps apply.

Using a salary sacrifice scheme with your employer means you don’t feel the pinch on your pocket when the money is taken out of your take-home pay. 

Please note that salary sacrifice superannuation contributions are classified as employer concessional contributions. Some employers may not offer salary sacrifice to employees. Before making any decision you should consider concessional contribution limits and seek advice from a licensed financial tax adviser.