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AussieCalc

Salary Sacrifice & Super Calculator

Estimate your annual tax saving, super boost, and retirement balance from salary sacrificing, modelled over your actual career span.

When to use

When you're thinking about salary sacrificing into super and want to see the tax saving and retirement impact side by side.

Who it's for

Employees under 67 who want to reduce income tax while growing their superannuation balance faster.

What you'll need

Your gross salary, employer contribution rate, how much you plan to sacrifice, and your current and retirement age.

FY2026–27 tax rates · 12% SGC · $30K concessional cap
$

Your total pre-tax salary before any sacrifice.

$

Pre-tax salary redirected to super. Taxed at 15% in super instead of your marginal rate.

Enter your sacrifice in whatever cadence suits you, the calculator converts it to an annual figure automatically.

Your employer's compulsory contribution rate, used to model total super and check the concessional cap.

Employer SGC is compulsory and separate. Under current Australian legislation, salary sacrifice sits in addition to your employer's compulsory Super Guarantee. Sacrificing does not reduce your employer contributions, you can verify this with HR if you have an older or non-standard employment contract.

Tax uses FY 2026-27 brackets with 2% Medicare levy. Super projection assumes 7% p.a. balanced fund return, annual compounding, and constant contributions to retirement age. Does not include LITO, contributions tax on employer SGC, fund fees, or HECS. General guidance only — not financial advice.

Super balance at retirement — with vs without salary sacrifice

37-year projection (age 30 to 67) at 7% p.a.

With $5,000/yr sacrificeEmployer SGC only (no sacrifice)
Line chart comparing super balance growth with and without salary sacrifice
PeriodWith $5,000/yr sacrificeEmployer SGC only
Age 30$0$0
Age 34$64K$45K
Age 38$148K$105K
Age 42$258K$182K
Age 46$403K$284K
Age 50$592K$418K
Age 54$841K$593K
Age 58$1.2M$823K
Age 62$1.6M$1.1M
Age 66$2.2M$1.5M
Age 67$2.3M$1.6M

Salary sacrifice adds $681,434 to your super by age 67 — at a net cost of $3,400/yr in take-home pay, saving $850/yr in tax.

Want to model the full retirement picture?

This calculator shows the super impact of your sacrifice. Use these tools to see how your balance converts to retirement income, when you could reach financial independence, and how your full wealth position looks.

Superannuation Calculator →Retirement Income Calculator →FIRE Calculator →

Carry-forward concessional contributions

If your total super balance is below $500,000 at 30 June of the previous financial year, you may be able to carry forward unused concessional cap space from the past five years. This means you could contribute more than the standard $30,000 in a single year while still receiving concessional tax treatment, useful if you had a low-income period, a career break, or a large one-time bonus.

This calculator does not estimate carry-forward balances. To check your available carry-forward amount: myGov → ATO Online Services → Super → Concessional contributions

Is salary sacrifice worth it for you?

The tax benefit of salary sacrifice depends heavily on your marginal income tax rate. Here is how it generally plays out at different income levels. This is general information, not personal financial advice.

Below $45,000

Lower-income earners

At this income level your marginal rate (15% under FY2026–27 brackets) equals the 15% contributions tax inside super. The only saving is the 2% Medicare levy on the sacrificed amount, a very small benefit. For most people here, maintaining liquidity and addressing debt or savings goals first makes more sense than locking money in super until preservation age.

$45,000–$135,000

Middle-income earners

The 30% marginal rate (plus 2% Medicare levy) means every dollar sacrificed saves 17 cents in combined tax compared to taking it as income, after the 15% contributions tax. On a $5,000 sacrifice that is $850 in annual tax savings, with $4,250 entering super. This is where salary sacrifice is typically most cost-effective relative to take-home pay impact. The longer the time to retirement, the more compounding amplifies the result.

Above $135,000

Higher-income earners

At the 37% or 45% marginal rate, the gap between marginal tax and the 15% contributions rate grows substantially, up to 32 cents per dollar saved before Division 293. However, high-income earners should check whether Division 293 tax applies (incomes above $250,000 attract an additional 15% on concessional contributions), and confirm they are not approaching the $30,000 concessional cap. Despite these considerations, salary sacrifice generally remains beneficial at higher incomes.

How salary sacrifice builds superannuation

What is salary sacrifice to super?

Salary sacrifice lets you redirect part of your pre-tax salary into superannuation before income tax is applied. Instead of paying your marginal rate on that money, it enters your super fund and is taxed at just 15%, the concessional contributions rate. For anyone earning above $45,000, this gap between marginal tax and 15% creates a real, annual cash saving that also builds your retirement balance.

The Australian superannuation system

Super is Australia's compulsory retirement savings system. Your employer is required to contribute at least 12% of your ordinary time earnings (SGC) into a super fund on your behalf. Salary sacrifice goes on top of this. Together, concessional contributions (your sacrifice plus employer SGC) are capped at $30,000 per financial year. Super is invested and grows tax-advantaged until you reach preservation age (typically 60).

Why compounding inside super matters

Investment earnings inside super are taxed at just 15% (or 10% for capital gains held over 12 months), compared to your marginal rate outside super. This tax advantage compounds year after year. An extra $4,250 per year sacrificed into super, growing at 7% inside the fund, becomes over $174,000 after 20 years. The same money invested outside super would generate far less after tax.

How the tax saving is calculated

The saving comes from the difference between your marginal income tax rate and the 15% contributions tax. On an $85,000 salary (32% marginal rate including Medicare), every $1,000 sacrificed saves $320 in combined income tax and Medicare levy, but costs $150 in contributions tax, a net $170 saving per $1,000. You lose $680 in take-home pay, so the true cost of putting $850 into super is just $680.

Worked examples

$85,000 salary: Sacrificing $5,000 per year from age 40
At $85,000 your marginal rate is 32% (30% income tax + 2% Medicare levy). Sacrificing $5,000 saves $1,600 in income tax; after 15% contributions tax ($750), $4,250 enters super. Take-home reduces by $3,400 (not $5,000) because of the income tax saving. Net annual tax benefit: $850. Employer SGC of $10,200 (12% × $85,000) brings total concessional contributions to $15,200, well within the $30,000 cap. At 7% return over 27 years (age 40 to 67), the extra $4,250 per year adds approximately $317,000 to super at retirement.
$125,000 salary: Maximising salary sacrifice near the cap
At $125,000 the marginal rate remains 32% (within the $45,001–$135,000 bracket). Sacrificing $14,000 per year saves $4,480 in income tax; after $2,100 contributions tax, $11,900 enters super. Take-home reduces by $9,520 per year ($793 per month). Employer SGC of $15,000 (12% × $125,000) brings total concessional contributions to $29,000, just within the $30,000 cap. At 7% return over 22 years (age 45 to 67), the additional $11,900 per year adds approximately $583,000 to super at retirement.
Checking the concessional cap before you sacrifice
The concessional contributions cap is $30,000 per year (FY 2026–27), covering employer SGC plus salary sacrifice combined. At a $150,000 salary, employer SGC alone is $18,000 (12%), leaving only $12,000 of headroom for salary sacrifice before hitting the cap. Contributions above the $30,000 limit are included in assessable income and taxed at your marginal rate, eliminating the tax benefit and potentially triggering a tax bill. Always confirm your employer SGC amount first and subtract it from $30,000 to find your effective sacrifice limit. The calculator flags when inputs exceed the cap.

Frequently asked questions

How much extra super will I have from salary sacrificing?
It depends on how much you sacrifice and how long you keep it up. Sacrificing $5,000 per year on an $85,000 salary sends roughly $4,250 net into your super each year (after 15% contributions tax). If your fund returns 7% p.a., that grows to approximately $174,000 extra in your super after 20 years, on top of your regular employer contributions. Use the projection in this calculator to estimate your personal figure.
What is the concessional contributions cap?
Concessional (pre-tax) contributions, employer SGC plus any salary sacrifice, are capped at $30,000 per financial year for FY 2026-27. If you exceed the cap, the excess is included in your assessable income and taxed at your marginal rate with a 15% tax offset. The calculator flags when your sacrifice plus employer SGC would exceed the cap so you can adjust.
Does salary sacrifice reduce my employer's compulsory super?
Generally no. The Super Guarantee is calculated on your Ordinary Time Earnings (OTE), which is typically your full salary before any sacrifice arrangement. Most agreements leave OTE unchanged, so your employer continues paying SGC on the full amount. A small number of older contracts define OTE differently, so check your employment agreement or ask your HR team to confirm.
When does salary sacrifice to super make the most sense?
The higher your marginal income tax rate, the bigger the benefit. If you earn between $45,000 and $135,000 (marginal rate 30% under Stage 3 cuts), every dollar sacrificed saves 15 cents in income tax compared to taking it as income, or about 17 cents once you include the Medicare levy. Earn above $135,000 (37% bracket) and the saving rises to about 24 cents per dollar including Medicare levy. It also makes more sense earlier in your career, since more years of compounding amplifies the long-term result significantly.
How does salary sacrifice affect my HECS/HELP repayment?
Salary sacrifice to super reduces your taxable income, which can push your Repayment Income below a higher HECS threshold and lower your mandatory repayment rate. However, the ATO includes Reportable Employer Super Contributions (RESC) when calculating Repayment Income, which limits this benefit for most salary sacrifice arrangements. Use the HECS calculator to model the combined effect.
Do I need my employer's agreement to salary sacrifice?
Yes. Salary sacrifice is a voluntary arrangement that must be agreed to by your employer and documented in writing before the income is earned. Not all employers offer it. Those that do may have rules around minimum sacrifice amounts or how often you can change your arrangement. Ask your HR or payroll team what is available. It cannot be backdated; the arrangement must be in place before you earn the income you want to sacrifice.
Can I salary sacrifice items other than super, such as a car?
Yes, if your employer offers it. Salary packaging a car through a novated lease is common in Australia, particularly in large organisations and government departments. Under a novated lease, the employer takes on the car lease and deducts payments from your pre-tax salary, reducing your taxable income. Most fringe benefits (including cars used privately), attract fringe benefits tax (FBT), which the employer either absorbs or passes on to you. Some items are fully FBT-exempt: laptop computers and portable electronic devices used primarily for work, certain professional memberships, and remote-area housing benefits. What is available depends entirely on what your employer's salary packaging scheme includes. Check with HR or payroll before assuming particular items qualify.
When might salary sacrifice not be the right choice?
Salary sacrifice is least effective at lower marginal rates. In FY2026–27, if your income is below $45,000 (marginal rate 15%), the income tax rate equals the 15% contributions tax, the only saving is on the Medicare levy (2%), so the benefit is very small. Too small to justify losing access to that cash until retirement for most people. Sacrificing too aggressively can also reduce take-home income below what you need for day-to-day expenses, potentially forcing you into higher-cost debt. Salary sacrifice also reduces assessable income, which can affect income-tested government benefits such as Family Tax Benefit. Finally, if your employer's SGC already brings you close to the $30,000 concessional cap, additional sacrifice can push you over the limit, triggering excess concessional contributions tax.

How this calculator works

Enter your gross salary and a salary sacrifice amount. The calculator applies the FY2026–27 tax brackets to work out your income tax and Medicare levy before and after the sacrifice, showing the exact dollar tax saving. The sacrificed amount enters your super fund and is taxed at 15% (the concessional contributions rate) rather than your marginal rate, which is how the saving is generated. The difference between those two rates (multiplied by the sacrifice amount) is your annual tax saving in cash terms.

The calculator also shows the net take-home pay reduction after accounting for the tax saving. Because you are no longer paying income tax on the sacrificed amount, you keep more of every dollar sacrificed than it might appear. For example, someone in the 30% marginal bracket sacrificing $10,000 saves $1,700 in tax, meaning their actual take-home pay only falls by $8,300, not the full $10,000.

Check the concessional contributions cap: for FY2026–27 it is $30,000 per year, including your employer's SGC. If your employer pays 12% SGC, you can sacrifice approximately $18,000 more before the cap is reached. Exceeding the cap removes the tax advantage, the excess is taxed at your marginal rate. The calculator does not model Div 293 tax, which applies to incomes above $250,000.

Methodology

  • Assumptions: FY2026–27 income tax rates; pre-tax super contributions taxed at 15% concessional rate within the fund; employer SGC paid on the full (pre-sacrifice) salary; Medicare levy saved on the sacrificed amount.
  • Calculation: Annual tax saving = sacrifice × (marginal income tax rate + 2% Medicare levy − 15%); take-home pay reduction = sacrifice − tax saving; super boost = sacrifice − (sacrifice × 15% contributions tax).
  • Limitations: Does not model Div 293 tax (additional 15% for incomes above $250,000), impact on income-tested government benefits, or salary packaging administration fees.

Sources

Last updated: July 2026

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