Understanding salary sacrifice contributions
Salary sacrifice is an arrangement where you agree to forgo part of your pre-tax salary in exchange for benefits such as additional superannuation contributions, a car, or other fringe benefits. The sacrificed amount is paid by your employer directly to the benefit provider, reducing your taxable income. This is common in Australia and can be an effective way to boost retirement savings or obtain perks while lowering your tax bill.
How salary sacrifice affects your salary comparison
The site's line is the national full-time adult ordinary-time average of $108,352 per year (ABS Average Weekly Earnings, May 2026, × 52 weeks). This figure represents ordinary-time earnings, which are the cash wages paid to employees for standard hours. Salary sacrifice amounts are generally not included in ordinary-time earnings because they are not paid directly to the employee. As a result, if you salary sacrifice, the salary you actually receive (the cash component) is lower than your total remuneration package.
When you use the tool to place a salary on the line, you should enter the amount you receive before tax as shown on your payslip. That amount is after any salary sacrifice deductions. The tool will then show how your cash salary compares to the full-time average. For example, if your total package is $120,000 but you sacrifice $15,000 into super, your cash salary is $105,000, which is below the average of $108,352. Your total package, however, is above the average.
Medians and minimum wage
For context, the full-time median salary is about $90,532 and the all-employees median is about $74,100 (ABS Employee Earnings, August 2025). The national minimum wage from 1 July 2026 is $26.44 per hour, $1,004.90 per week, or about $52,255 per year on a 38-hour week (Fair Work). If your cash salary after sacrifice falls below these figures, you are below the median or minimum wage.
Tax implications of salary sacrifice
Salary sacrifice reduces your taxable income, which can lower the amount of tax you pay. For the 2026–27 financial year, resident tax rates are:
- Nil on income up to $18,200
- 15% on income from $18,201 to $45,000
- 30% on income from $45,001 to $135,000
- 37% on income from $135,001 to $190,000
- 45% on income above $190,000
Plus the Medicare levy of 2% (subject to reductions for low-income earners). By sacrificing part of your salary, you may move into a lower tax bracket, increasing your after-tax income even though your cash salary appears lower.
State comparisons
The full-time average varies by state. For instance, the Australian Capital Territory has the highest average at $119,090, while Tasmania has the lowest at $96,008 (ABS Average Weekly Earnings, May 2026). If you live in a state with a higher average, salary sacrifice may make your cash salary appear even further behind. You can explore state figures on the States and territories page.
Using the tool correctly
To get an accurate comparison, always enter the salary you actually receive before tax. Do not include the sacrificed amount. The tool will calculate the weekly and hourly equivalents based on a 38-hour week and show the distance from the full-time average. If you are unsure about your figures, consult your payslip or employer.
For more details on how the figures are set, see How the figures are set.