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Salary sacrifice

How does it work?

With salary sacrifice, you arrange for your employer to contribute some of your pre-tax salary (or a bonus) into super rather than receiving it as take-home pay.

May be suitable if…

You're an employee.

What are the benefits?

  • Grow your super.
  • Pay less tax: the contributions are generally taxed at up to 15%¹view disclaimer, instead of your marginal tax rate, up to a maximum of 47%²view disclaimer.

Case study

Details Receive pay rise as after-tax salary Sacrifice pay rise into super
Pre-tax pay rise $5,000 $5,000
Less income tax at 39%, View disclaimer2 ($1,950) (N/A)
Less 15% contributions tax (N/A) ($750)
Net amount invested $3,050 $4,250
Additional amount invested   $1,200

Important things to consider

Disclaimer1. Individuals with income from certain sources above $250,000 in 2020/21 will pay an additional 15% tax on salary sacrifice and other concessional super contributions within the cap.

Disclaimer2. Includes Medicare levy.

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General advice and information only

Any advice and information on this website is general only, and has been prepared without taking into account your particular circumstances and needs. Before acting on any advice on this website you should assess or seek advice on whether it is appropriate for your needs, financial situation and investment objectives.

Tax disclaimer

Any general tax information on this website is intended as a guide only and is based on our general understanding of taxation laws. It is not intended to be a substitute for specialised taxation advice or an assessment of your liabilities, obligations or claim entitlements that arise, or could arise, under taxation law, and we recommend you consult with a registered tax agent.