Salary Packaging for Employers: Why Partner with a Specialist Provider
Salary packaging is one of the most valuable benefits a not-for-profit employer can offer, and one of the few that lifts your team's take home pay without adding to your salary budget. The catch is that running it well takes real tax expertise and careful compliance. That is exactly why most organisations partner with a specialist provider rather than doing it alone. Here is what that means for you.
What
salary packaging does for your people
Salary packaging lets eligible
employees pay for certain everyday expenses out of their pre-tax salary.
Because those costs come out before tax, their taxable income falls and their
take home pay rises. For staff at eligible not for profit organisations the
benefit is especially generous, thanks to Fringe Benefits Tax concessions the
sector is entitled to. The same salary can go noticeably further, which matters
enormously when you are competing for good people against larger or better
funded employers.
For you as the employer, that is a
powerful thing to be able to offer. It improves the real value of every role at
no extra cost to your salary budget, and it signals that you look after your
team. The concessions already exist for eligible organisations, so not offering
packaging effectively leaves value on the table for your staff.
Why not
just run it in house?
Some organisations do administer
packaging themselves, and for those that want to, Eziway even offers software
to make that possible. But running a compliant program by hand is a serious
undertaking. You need to understand the different FBT caps, apply them
correctly for each employee, keep accurate records, manage claims and
reimbursements, and report everything correctly at FBT time. Get it wrong and
the organisation carries the risk.
Partnering with a specialist provider
takes that weight off your team. The provider brings the tax expertise, the
systems and the employee support, so your people get the benefit, and your
payroll team is not left carrying a complex compliance burden on top of their
day job.
What a
specialist provider handles
●
Compliance. The provider keeps your program
aligned with ATO rules, applies the correct caps, and manages FBT reporting and
record keeping.
●
Employee support. Your staff get real people to talk
to, plain answers to their questions, and easy claiming through a card and an
app.
●
Administration. Claims, reimbursements and statements
are handled through purpose-built technology that fits alongside your payroll.
●
Sector expertise. A good provider knows the not for
profit, health and education sectors inside out, so nothing gets missed.
What to
look for when choosing
Not every provider is the same, and
because packaging touches both your people's pay and your compliance, it pays
to choose carefully. The things that matter most are genuine experience in your
sector, strong compliance credentials, responsive service that treats your
staff as people rather than ticket numbers, technology that makes packaging
easy for everyone, and clear, honest pricing. If a provider is vague about any
of these, keep looking.
The
cost of getting salary packaging wrong
Salary packaging is generous, but it
sits on top of tax rules that carry real consequences if they are mishandled.
Applying the wrong cap, missing a reportable fringe benefits obligation, or
keeping incomplete records can expose your organisation at FBT time and chip
away at the trust your staff place in the program. For a not for profit, where
budgets are tight and reputation matters, that is a risk worth taking
seriously.
This is the quiet value a specialist
provider adds. They keep your program correct, your records clean and your
reporting accurate, so the organisation is protected and your people can be
confident their pay is being handled properly. You get the upside of the
benefit without carrying the compliance exposure that comes with it.
A
benefit that helps you attract and keep good people
The not-for-profit sector rarely
competes on salary alone, so the value you can add around pay matters
enormously. Salary packaging is one of the few levers that lifts an employee's
take home pay without increasing your wage bill. That makes every role you
advertise more attractive, and it gives your existing team a concrete, ongoing
reason to stay.
In a tight labour market, being able
to say that you offer full salary packaging, administered well, is a genuine
advantage when a candidate is weighing you against a larger or better funded
employer. It signals that you look after your people in practical, financial
terms, not just in words.
Moving
providers is easier than you think
If you already offer packaging and
are frustrated with your current provider, the fear of disruption is often what
holds organisations back. It should not. A capable provider manages the whole
transition for you, moving employee arrangements across, coordinating with your
payroll team, and communicating clearly with staff so nobody is left confused
about their pay. Done properly, changing providers feels like a weight lifted
rather than a project landed on your desk.
Common
questions from employers
Does
offering salary packaging cost us more?
Generally, no. The benefit is funded
from the employee's own pre-tax salary and the tax concessions your
organisation is entitled to, not from your salary budget. With a provider
managing it, the day-to-day cost and effort on your side stay low.
Is it a
lot of work for our payroll team?
With the right provider, very little.
They handle the calculations, compliance, reporting and employee questions,
while your payroll team simply processes the agreed deductions, much like any
other pay arrangement.
Which
of our staff are eligible?
Eligibility depends on your
organisation type and the current rules. A specialist will confirm exactly what
your people can package and how much and explain it to them in plain language.
Why
employers across the sector choose Eziway
Eziway has focused on Australia's not
for profit sector since 2007. We pair deep compliance expertise with genuinely
personal service, real people who know your organisation, and technology that
makes packaging effortless for staff and payroll alike. We call ourselves a no
noise partner because our job is to make salary packaging simple and valuable,
then stay out of your way.
If you are weighing up whether to offer salary packaging or
looking to move from a provider that is not delivering, we would welcome a
straightforward conversation about what a well run program could do for your
team. Get in touch and we will make it easy.
Want to learn
more?
See what a well-run
salary packaging program could do for your team, at no extra cost to your
salary budget.
Click Below
Link to Enquire:
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