Salary packaging is an arrangement when you can sacrifice part of your future salary in return for receiving remuneration in a different form such as fringe benefits or superannuation benefits. Common fringe benefits include the provision of a car or having your employer pay or reimburse expenses on your behalf.

Salary packaging is widely used in many organisations because it can bring advantages to both employer and employees including:

• the ability for employees to receive remuneration with a lower overall tax
• increased loyalty from employees as there is often greater recognition of their contribution
• lower payroll on-costs for employers.

Salary packaging can be very complex but many legitimate and tax-effective opportunities exist.