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A fringe benefit is an extra benefit supplementing an employee's monetary wage or salary. For example: A company car, private health care, fitness club membership, phone or internet service reimbursement, etc. In Australia, a fringe benefit is a payment to an employee that is not considered part of the employee's income.
Salary packaging (also known as salary sacrifice or salary exchange) is the inclusion of employee benefits (also called fringe benefits) in an employee remuneration package in exchange for giving up part of monetary salary. Such arrangements are entered into most commonly if there are tax or other benefits to be derived by the employer or ...
In a salary sacrifice arrangement an employee gives up the right to part of the cash remuneration due under their contract of employment. Usually the sacrifice is made in return for the employer's agreement to provide them with some form of non-cash benefit. The most popular types of salary sacrifice benefits include childcare vouchers and ...
But even if you have the same salary as someone, that doesn't mean you will have the same net pay. Net pay is affected by certain taxes, benefits, wage garnishments and other deductions.
Special rules apply in relation to employers operating "defined benefit" superannuation schemes, which are less common traditional employer funds where benefits are determined by a formula usually based on an employee's final average salary and length of service. Essentially, instead of minimum contributions, employers need to make ...
The salary method is more stable, as you can set up weekly, biweekly, or monthly payments through payroll. However, there isn’t much flexibility if you need to cut your pay when the business isn ...