Salary Sacrifice Calculator Australia (FY2025–26)

Salary Sacrifice in Australia: A Complete Guide (FY2025-26)

Salary sacrifice is one of the most powerful tax-reduction strategies available to Australian employees. By redirecting part of your pre-tax salary to approved benefits, you reduce your taxable income and pay less income tax — effectively getting more value for every dollar you earn.

With EOFY approaching on 30 June 2026, salary sacrifice decisions made before the end of the financial year can significantly reduce your FY2025-26 tax bill. Two of the most common salary sacrifice strategies are superannuation top-ups and novated lease vehicles.

Super Salary Sacrifice: Reduce Tax, Grow Retirement Savings

The most accessible salary sacrifice option is extra superannuation. Contributions made via salary sacrifice are classified as concessional contributions — they're taxed at just 15% inside the super fund, compared to your marginal income tax rate (up to 45% plus Medicare levy).

For FY2025-26, the concessional contributions cap is $30,000. This cap includes your employer's compulsory Superannuation Guarantee (SG) contributions — now at 11.5% of your ordinary time earnings. If your employer pays $9,200 in SG on a $80,000 salary, you can sacrifice up to $20,800 in additional super before hitting the cap.

The tax saving is calculated as the difference between your marginal tax rate and the 15% contributions tax. For a 37% taxpayer, that's a 22% saving on every dollar sacrificed — very significant over time.

Novated Lease: Drive Your Next Car From Pre-Tax Salary

A novated lease lets you bundle the entire cost of a car — finance, fuel (or charging), insurance, rego, and maintenance — into a single pre-tax salary deduction. Because these costs come from your pre-tax income, you effectively save GST on the vehicle purchase and income tax on all running costs.

Historically, novated leases attracted Fringe Benefits Tax (FBT), which reduced their effectiveness for higher-income earners. But from 1 July 2022, the Australian Government introduced a full FBT exemption for eligible electric vehicles (EVs) under the luxury car tax threshold — making EV novated leases one of the most tax-effective ways to acquire a vehicle in Australian history.

EOFY Deadline: Act Before 30 June 2026

Salary sacrifice decisions must be made prospectively — you cannot retroactively sacrifice salary you've already received. To increase your super contributions for FY2025-26, you need to have an arrangement in place with your employer before 30 June 2026. Some employers require 2–4 weeks notice to process a change.

• Contact your payroll team now to set up or increase salary sacrifice to super before EOFY.
• If you're considering a novated lease, initiate the application process early — fleet approvals and vehicle orders take time.
• Check your super fund's website for concessional contributions tracking to avoid exceeding the $30,000 cap.
• Consider carry-forward concessional contributions if your super balance is below $500,000 and you have unused cap from prior years.