What Is Super Salary Sacrifice?

Boost your retirement savings while reducing your taxable income

Salary sacrificing into super is a tax-effective way to grow your retirement savings. By redirecting part of your pre-tax salary into your super fund, you can reduce your taxable income and potentially pay less tax, while investing in your future.

What Is Super Salary Sacrifice?

Super salary sacrifice is a voluntary arrangement between you and your employer. Instead of receiving part of your salary as cash, your employer contributes it directly to your super fund. These contributions are taxed at a concessional rate of 15% (or 30% if your income exceeds $250,000), which is generally lower than your marginal income tax rate. For more details, visit the ATO’s official page on Salary Sacrificing Super.

Key Benefits of salary sacrifice

• Reduces your taxable income
• Contributions taxed at 15% (or 30% for high-income earners)
• Helps grow your super faster
• Not subject to Fringe Benefits Tax (FBT)

Who Is Eligible?

Any employee can request a salary sacrifice arrangement, provided their employer offers it. This includes permanent staff, fixed-term employees, and contractors directly employed by the organisation.

To qualify:

• You must enter the arrangement before the income is earned
• Contributions must go to a complying super fund
• You must stay within the concessional contributions cap

Contribution Limits

For the 2025–26 financial year:

• The concessional (before-tax) contributions cap is $30,000
• This includes employer Super Guarantee contributions and salary sacrifice amounts combined
• If your total super balance is under $500,000, you may carry forward unused cap amounts from the past five years
  

Important Considerations

• Salary sacrifice contributions are reportable and must be included in your tax return
• They do not reduce your employer’s Super Guarantee obligations
• Contributions exceeding the cap may attract additional tax
• Division 293 tax applies if your income plus concessional contributions exceed $250,000

How to Get Started

Complete Whizdom’s Salary Sacrifice Request – Super Contributions form and submit it online. Our Finance Team will review your request and confirm the arrangement with you before processing it in the next pay cycle.

For more detailed information, visit the ATO’s official page on Salary Sacrificing Super. Or reach out to our finance team

for a confidential chat.