Superannuation

Option 1 – salary sacrifice to super

Your cash salary is reduced by $1,200 a year ($100 a month) and in exchange your employer increases your contributions to super (as salary sacrifice contributions).
Your after-tax salary reduction is $1,200 pa ($100 per month) which is the equivalent of $1,778 pa before tax (based on the marginal tax rate of 32.5% without Medicare, which applies in this scenario). This is the amount salary sacrificed in this scenario.
Your gross cash salary is reduced from $40,000 pa to $38,222 pa by the $1,778 salary sacrificed, thereby reducing tax payable on your income. Tax payable on this income is $3,969.15 (plus Medicare).
Tax of 15% will apply to the $1,778 contributions made to superannuation, totalling $266.70. With total net contributions of $1,511.30.

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