Sacrifice some of your Salary and Save Tax

There are a range of different strategies to take advantage of available cash flow, one of which is to salary sacrifice into super.

If you expect to receive a bonus from your employer you may want to consider 'salary sacrifice?, where you make extra contributions to your super from your pre-tax income. You may also opt for a salary sacrifice arrangement with your employer, for regular sacrificing of your salary. This strategy enables you to pay less income tax and increase the size of your after-tax investment.

Sara (age 35) earns $75,000pa and wants to top up her super. She 'sacrifices' $10,000 of her pre-tax salary to super. The $10,000 she has directed into her super is only taxed at 15%. As a result, she has invested $1,650 more money than if she had kept the $10,000 as taxable income and then invested what was left after tax.