What is Salary sacrifice?
Payroll & people. A plain-English definition for Australian business owners.
Salary sacrifice is an arrangement where an employee agrees to receive less cash salary in exchange for a benefit (typically additional super contributions, a car, or other benefits).
Properly structured, it reduces the employee's taxable income; improperly structured, it triggers FBT or other tax consequences. The arrangement must be documented and prospective (not retrospective).
In a connected back office this sits with the People hub, where Valont runs award compliance, hr & ir advisory and employer advice line for Australian SMEs as one team. The full definition set is on the glossary.
Talk to an Advisor
General information, not advice. For how this applies to your business, talk it through with a Trusted Advisor or start with the Business Health Check.