Religious Practitioners and Salary Packaging

Benefits provided to certain employees of 'religious institutions' are exempt benefits under section 57 of the FBTAA (1986)

• if the employee is a religious practitioner (ie. a minister of religion, a full-time member of a religious order or a person training to be a minister of religion or full-time member of a religious order.
• if the benefit is provided to the employee, the employee's spouse or the employee's child.
• if the benefit is not provided principally in respect of duties of the employee, other than pastoral duties or any other duties or activities related to the practice, study, teaching or propagation of religious beliefs.

Religious practitioners may gain benefit from an exemption from Fringe Benefits Tax (FBT) on salary-sacrificed exempt benefits. These benefits are deducted from the employees’ contract salaries (or stipends), so that their taxable income (and tax) is reduced.

The types of Exempt Benefits available include:

• Mortgage and personal loan repayments
• Line of Credit repayments
• Credit card repayments
• Private expense reimbursements
• Meal Entertainment expenses
• Health fund premiums
• Private use of a motor vehicle owned or leased by the employer
• A laptop or notebook computer (one per employee per year)
• An item of computer software for use in the employee's employment
• A brief case
• A calculator
• An electronic diary or similar
• A mobile phone required for work contact

All of these benefits can be flexibly tailored to suit individual employees’ circumstances using the Mistral Salary Packaging program. Of particular benefit is the ability to model different packages to see the net benefits to employees, and to determine the optimum mix of cash salary and fringe and exempt benefits. A mechanism is available to limit the percentage of salary that may be sacrificed to fringe and exempt benefits.