What is Salary Packaging?
Salary packaging allows employees to pay for fringe benefits from their pre-tax income, resulting in savings to both the employee and the employer. Through novated leasing, employees can save on the purchase of their new cars, whilst saving their employers money on payroll tax at the same time.
Why Should We Salary Package?
There are many benefits to both employers and employees that are gained by salary packaging and the novated leasing of cars. Here are just a few:
- Employees reduce their taxable income - because salary packaging and novated leasing is paid for out of an employee’s gross salary, their taxable income is reduced.
- Employers save on payroll tax - because employees’ taxable income is reduced, so too is their employer’s payroll tax amount - the more employees who salary package their cars, the greater the savings for the employer.
There’s more. Find out all the benefits of salary packaging and more information about novated leasing.