Salary Packaging Calculator Australia (2026–27)
Calculate your salary packaging tax savings under current ATO rules. Model Public Health ($9,010 cap), PBI Charity ($15,900 cap), Meal Entertainment ($2,650 cap), and corporate work-use exemptions.
Estimated Annual Income Tax Saved
$2,883
Tax savings generated by paying expenses from pre-tax salary.
Net Annual Take-Home Cash Boost
+$2,883
Extra take-home money retained annually in your pocket.
Reportable Fringe Benefit (RFBA)
$17,000
Grossed-up value reported on payment summary (for HECS/FTB).
Salary Packaging Tax & Take-Home Pay Breakdown
1. The Australian Salary Packaging System (2026–27)
Salary Packaging (or salary restructuring) is governed by the Fringe Benefits Tax Assessment Act 1986.
Employees working in non-profit, public health, and charitable sectors enjoy statutory FBT exemptions allowing thousands of dollars in everyday living expenses to be paid tax-free.
2. Industry Sector Salary Packaging Benchmarks
| Employer Sector | Living Expenses Cap | Meal Entertainment Cap | Annual Tax Saved | Take-Home Pay Boost |
|---|---|---|---|---|
| PBI Charity Worker ($90k Salary) | $15,900 Living Cap | $2,650 Meal Cap | $5,936 Tax Saved (32% Rate) | +$114.15 / week |
| Public Health Nurse ($110k Salary) | $9,010 Living Cap | $2,650 Meal Cap | $4,547 Tax Saved (39% Rate) | +$87.44 / week |
| Corporate Manager ($160k Salary) | Work Items (Laptop/Phone) | N/A (Full FBT) | $1,950 Tax Saved (39% Rate) | +$37.50 / week |
| EV Novated Lease ($140k Salary) | $13,500 EV Lease Packaged | N/A (0% EV FBT) | $5,265 Tax Saved (39% Rate) | +$101.25 / week |
3. The Mathematics of FBT Gross-Up Caps & Net Take-Home Pay
Net Annual Tax Savings (Savings_net) for pre-tax packaged expenses (P_exp) and marginal tax rate (r_marginal %) is:
Example PBI Packaging Calculation ($15,900 Cap @ 39% Marginal Rate):
- Pre-Tax Living Expenses Packaged: $15,900.00 / year.
- Income Tax + Medicare Saved: $15,900 × 39% = $6,201.00 tax saved.
- Reportable Fringe Benefits Amount (RFBA) on Income Statement: $15,900 × 1.8868 = $30,000 RFBA.
- Net Take-Home Pay Increase = +$119.25 / week extra cash.
4. Step-by-Step Guide to Salary Packaging
Determine Employer Industry FBT Category
Identify whether employer is a Public Health Org ($9,010 cap), PBI Charity ($15,900 cap), or Corporate Org.
Select Allowable Pre-Tax Expenses & Meal Cards
Nominate mortgage, rent, credit card, or meal entertainment payment cards for pre-tax deduction.
Calculate Gross-Up Value & FBT Exemption Limits
Ensure pre-tax deductions remain strictly within statutory FBT cap limits ($15,900 / $9,010 / $2,650).
Calculate Income Tax Saved & Take-Home Pay Increase
Multiply total pre-tax packaged expenses by your marginal tax rate plus 2% Medicare levy.
Reconcile Reportable Fringe Benefits (RFBA) at Tax Time
Verify grossed-up RFBA value on myGov Income Statement for HECS repayment reconciliation.
5. Salary Packaging Mistakes & Checklist
Unspent Salary Packaging Card Balances at 31 March FBT Year End
Leaving funds on packaging cards past 31 March, causing unspent funds to roll into the next FBT year cap.
Forgetting RFBA Impact on HECS-HELP Debt Repayments
Packaging $15,900 living expenses without accounting for $30,000 RFBA pushing HECS into 10% repayment tiers.
Packaging Non-Exempt Expenses in Corporate Commercial Jobs
Attempting to package rent or mortgage in corporate jobs, incurring 47% Fringe Benefits Tax penalties.
Failing to Submit Proof of Mortgage or Rent Expenses
Failing to provide active lease agreements or mortgage statements to packaging administrators.
Salary Packaging Compliance Checklist
Employer PBI / Health FBT Exemption Letter
Obtain employer confirmation of PBI charity ($15.9k) or Health ($9.01k) FBT exemption status.
Salary Packaging Payment Card Receipt Audit
Retain proof of expenditure receipts for meal entertainment and living expense card audits.
31 March FBT Year-End Spending Deadline
Ensure salary packaging card funds are fully spent prior to 31 March FBT year end.
RFBA HECS Repayment Threshold Audit
Calculate impact of grossed-up RFBA on compulsory HECS repayment percentages.
6. Annual Salary Packaging FBT Timeline
FBT Year Start & Cap Reset
New $15,900 / $9,010 living expense and $2,650 meal entertainment caps active.
Pre-Tax Packaging Payroll Deduction
Pre-tax funds deducted from salary and loaded onto packaging cards or sent to mortgage lender.
FBT Cap Spending Deadline
All packaging card balances must be spent; annual FBT reconciliation finalized by administrator.
ATO myGov RFBA Reporting
Reportable Fringe Benefits Amount (RFBA) reconciled on individual ATO income tax return.
Disclaimer: This Salary Packaging calculator and guide are provided for general educational and informational planning purposes only. Health FBT caps ($9,010), PBI charity caps ($15,900), meal entertainment caps ($2,650), and gross-up multipliers reflect 2026–27 Australian Taxation Office guidelines. This page does not constitute formal tax or employment advice.
Charlotte Smith
Senior Personal Finance & Taxation Specialist at AussieSpot
Charlotte Smith is the lead personal finance advisor and workplace specialist at AussieSpot. Charlotte has over 12 years of experience helping Australian households build budgets, plan savings goals, and manage living costs.
Frequently Asked Questions (FAQ)
What is Salary Packaging and how does it work in Australia?
Salary Packaging is an ATO-approved agreement allowing employees to pay for personal expenses (rent, mortgage, credit cards, meals, cars) directly from pre-tax salary. This lowers taxable income and increases net take-home pay.
What salary packaging FBT cap exemptions apply to Health & PBI Charity workers?
Public Health and Ambulance workers can package up to $9,010 in pre-tax general living expenses ($17,000 grossed-up cap). Public Benevolent Institution (PBI) charity employees can package up to $15,900 in living expenses ($30,000 grossed-up cap), plus a separate $2,650 meal entertainment cap.
What work-related items can corporate employees salary package FBT-free?
Corporate employees can package work laptops, smartphones, tablets, work-related self-education, and eligible Electric Vehicles (EV novated leases under $91,387) FBT-free under work-use exemptions.
How do Reportable Fringe Benefits (RFBA) affect HECS and Government Benefits?
Salary packaged living expenses are reported as Reportable Fringe Benefits (RFBA) on your myGov Income Statement. RFBA is added back to taxable income to calculate Repayment Income for HECS loan repayments, Family Tax Benefits, and Medicare Surcharge.
When is the Salary Packaging FBT Year End?
The Fringe Benefits Tax (FBT) year runs from 1 April to 31 March (NOT the standard 1 July – 30 June tax year). All packaging caps must be fully spent prior to 31 March each year.