Industry Switcher
How does salary packaging work?


Check out our FAQs for answers to commonly asked questions about salary packaging with Maxxia.

How will it affect my pay?

This is what happens to your pay once you've set up a salary packaging account.

  1. Each pay cycle, your payroll department deducts a nominated portion of your salary before tax and sends those funds to us.
  2. You can then use these funds to pay for your chosen benefits (e.g. superannuation, portable electronic devices etc.).
  3. The rest of your salary gets taxed. And because some of your salary has been taken out (to pay for your chosen expenses), you are taxed on a lower amount.
  4. Your post-tax salary is then deposited into your bank account as usual.

Is it too good to be true?

Hundreds of thousands of Australians benefit from salary packaging every year.

Salary packaging has been permitted by the Australian Taxation Office (ATO) since 1986. Since then, it's been used to retain and reward employees who work in industries like health and charity.

Eventually this expanded into the private and public sectors, and now hundreds of thousands of Australians are enjoying the benefits.

Many employers within the private and public sector offer salary packaging as a way to reward and retain their staff.

What if I have a HECS/HELP debt?

You could benefit from salary packaging even if you have a HECS/HELP debt.  To find out if you could benefit, use our HECS/HELP calculator

What are cap limits?

If you work in the public health or charity industry, you can package certain items up to a set amount - referred to as your FBT exemption 'cap limit'.

The cap limit is the highest amount you can salary package within a Fringe Benefits Tax (FBT) year (1 April to 30 March) without incurring FBT.

If you salary package capped benefits over the cap limit, FBT will be applied - and you could pay tax on the extra.

From 1 April 2017, if you work in the health or charity sector you will also have access to a combined annual cap limit of $2,650 ($5,000 ‘grossed-up’) which applies to both Meal Entertainment and Venue Hire benefits each Fringe Benefits Tax (FBT) year. 

What if I change jobs?

If you change jobs during you need to contact us straight away to discuss your options.

You may have the option to:

  • continue to package benefit items if your new employer offers salary packaging.

If you have a novated lease:

  • pay the amount owing under your lease and buy the vehicle outright.
  • continue the lease directly with the financier, making all payments yourself.
  • transfer the lease to your new employer (subject to your new employer's approval).

What are the cap limits for my industry?

Health employees
Health employees can salary package a range of benefits up to $9,010 each FBT year.

This cap limit is based on payments that are not subject to GST. Payments subject to GST will have a cap limit of $8,172.

Not-for-profit employees
Not-for-profit employees can salary package a range of benefits up to $15,900 each FBT year.

This amount is based on payments not subject to GST. Payments subject to GST will have a cap limit of $14,421.

Which benefits are capped and which are not?

Some capped benefits include:

  •  mortgage repayments
  •  rent payments
  •  personal loan repayments
  •  living expenses.

Some uncapped benefits include:

  •  a car via a novated lease
  •  Salary Packaging Payment Card
  •  Superannuation
  •  Ipad, smart phone, laptop

How much could I save?

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