Salary sacrifice

Salary sacrifice is a formal agreement with your employer to redirect part of your pre-tax salary into super (or other benefits) instead of taking it as cash.

The sacrificed amount is taxed at 15% inside super rather than your marginal income tax rate, which can be 32.5% or 37% or 45% depending on your salary. For most middle-income earners, this is the single most effective lever for reducing tax legally.

The combined cap on concessional contributions (employer SG + salary sacrifice + personal deductible) is $30,000 in FY 2025-26.