Understanding remserv salary packaging and your take-home pay
Pay varies by employer and arrangement; no single figure is available for remserv salary packaging.
What is remserv salary packaging?
Remserv salary packaging (also called salary sacrificing) is a way to structure your pay so that part of your pre-tax salary goes towards approved benefits instead of cash. The Australian Taxation Office explains that under an effective arrangement, you and your employer agree on a reduced salary in exchange for benefits of similar value. This lowers your taxable income, meaning you may pay less income tax and Medicare levy.
Salary packaging is common for items like cars, super contributions, laptops, or childcare. However, from 1 April 2027, work-related items provided through salary sacrifice will no longer be FBT-exempt, so check the rules with your employer.
How remserv salary packaging changes your take-home pay
Your take-home pay is the amount that reaches your bank account after tax and the Medicare levy. The ATO provides a clear example on comparing three scenarios for an employee with $65,000 annual remuneration:
- Salary only (no packaging): Taxable income $65,000, income tax $10,288, Medicare $1,300, net disposable income after car expenses $41,912.
- Salary plus car (without employee contributions): Taxable income $47,647, tax $5,082, Medicare $953, net disposable income $41,612.
- Salary plus car (with employee contributions): Taxable income $60,855, tax $9,045, Medicare $1,217, net disposable income $43,593.
Notice that with employee contributions, net disposable income is actually higher than without packaging. The key is that the benefit replaces an expense you would otherwise pay with after-tax money.
Gross salary vs package vs take-home
A common mix-up is confusing your gross salary (the figure in your contract) with your package (salary plus benefits) and your take-home (cash after deductions). For example, if your employer offers a $100,000 package that includes a car worth $15,000, your cash salary is $85,000. Your take-home will be calculated on that $85,000 after tax and Medicare.
Take-home pay depends on the tax rates for 2026–27. For a resident:
- $0–$18,200: nil tax
- $18,201–$45,000: 15c per $1 over $18,200
- $45,001–$135,000: $4,020 plus 30c per $1 over $45,000
- Plus 2% Medicare levy (full rate applies above the latest published single-person thresholds of $28,011 and $35,013)
If you earn the national minimum wage of $26.44 per hour ($1,004.90 per week), your annual salary is $52,255. Without packaging, your take-home after tax and Medicare would be roughly $43,000. With remserv salary packaging, you could reduce taxable income further, but the benefit itself may have ongoing costs.
Super and remserv salary packaging
Salary sacrificed super contributions are treated as employer contributions and are not subject to FBT. They are taxed at 15% inside the super fund, which is often lower than your marginal rate. However, they count towards the concessional contributions cap ($32,500 for 2026–27). Your employer must still pay the super guarantee (12% from 1 July 2026) on your ordinary time earnings, not on the sacrificed amount.
notes that putting pre-tax income into super can be tax-effective, but you cannot access that money until retirement. Also, salary packaging may affect government benefits and child support, so consider the full picture.
Should you use remserv salary packaging?
It depends on your income, the benefits offered, and your personal circumstances. Use a take-home pay calculator to compare scenarios. Remember that you cannot claim a tax deduction for expenses your employer pays as part of the package. Always get the agreement in writing before you earn the income.
For more details, see our Guides on salary packaging and the Clearance tool to estimate your net pay.
Questions
What is remserv salary packaging?
Remserv salary packaging, also known as salary sacrificing, is an arrangement where you and your employer agree to reduce your pre-tax salary in exchange for certain benefits, such as a car, super contributions, or electronic devices. The benefits replace part of your salary, lowering your taxable income and potentially reducing the tax you pay. The Australian Taxation Office requires the arrangement to be in place before you perform the work, and you cannot access the sacrificed salary.
How does remserv salary packaging affect my take-home pay?
Your take-home pay is the amount deposited into your bank account after income tax and the Medicare levy are deducted. With remserv salary packaging, your taxable income is reduced, so less tax is withheld. However, the benefit itself (e.g., car lease payments) is often paid by your employer from the sacrificed amount, so your net disposable income may be higher or lower depending on the benefit type and any employee contributions. The ATO provides examples showing that with careful structuring, net disposable income can increase.
Is remserv salary packaging always tax-effective?
Not always. While salary packaging reduces your taxable income, the benefits are subject to fringe benefits tax (FBT) for your employer, which may limit what is offered. Additionally, salary packaging can affect your Medicare levy surcharge, study loan repayments, and government benefits. You should compare the after-tax cost of the benefit if purchased with post-tax income versus the packaged arrangement. Using a take-home pay calculator can help you model different scenarios.