How much can a nurse save?
A registered nurse earning $88,000 is in the 30% tax bracket plus 2% Medicare, so each packaged dollar saves about 32 cents. Packaging the full cash limit of about $9,009 saves around $2,880 a year before provider fees. Enrolled nurses and graduates on lower salaries save slightly less per dollar, but the saving is still worthwhile once they are above $45,000.
What do nurses usually package?
Most nurses package their largest predictable expenses so the full cap is used evenly across the year:
- Rent or mortgage repayments
- Car loan repayments and running costs
- Credit card payments
- Meal entertainment card for dining out (separate cap)
Things to check with your health service
Each health service or state government has its own salary packaging provider and rules. Confirm the provider's fees, how often you can change your packaging amount, and whether packaged amounts are paid by card, direct debit or reimbursement.
Watch the reportable fringe benefits amount
Packaged benefits are reported on your income statement as a reportable fringe benefits amount (RFBA) once the grossed-up value exceeds $2,000. RFBA does not raise your income tax but it counts toward income tests such as HELP repayments and the Medicare levy surcharge. See our guide to RFBA.