How Does Salary Sacrifice Work?
Under salary sacrifice, you and your employer agree to reduce your salary by a certain amount each pay period. In return, your employer provides you with benefits of a similar value. The key thing to remember is that salary sacrificing is a voluntary agreement between you and your employer. It’s not compulsory, and you can withdraw from the arrangement at any time.
As every arrangement has its own advantages and disadvantages. Salary sacrifice also has some advantages and disadvantages, which we will discuss further.
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.
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