Post-Tax Adjustment FAQs
Included in these FAQs
- Why does Smartsalary deduct post-tax amounts for your car
- What is a Post-Tax Adjustment (PTA)?
- Why do I have a PTA?
- How is my PTA adjusted?
- When will my PTA be available?
- How will I know which method will be available to me?
1. Why does Smartsalary deduct post-tax amounts for your car?
In order to avoid an FBT liability on your salary packaged vehicle Smartsalary funds a portion of your lease and running costs using post-tax dollars.
According to ATO guidelines the amount funded by post-tax deductions must not be less than the amount calculated by the following formula:
Vehicle Base Value x Statutory % x Days Available during FBT Year
Days during FBT Year
2. What is a Post-Tax Adjustment (PTA)?
Where the amount of post-tax dollars deducted by Smartsalary and applied to your lease and running costs is more than the above amount then you may become entitled to a Post-Tax Adjustment (or PTA).
A PTA is a salary packaging adjustment used to reverse the impact of your extra post-tax payments, and can be processed using one of the methods outlined below.
Note: A PTA does not mean that post-tax funds you contributed towards your vehicle remain unspent at the end of the year. A PTA means that the mix between post-tax and pre-tax amounts collected from you (and spent) during the year included more towards post-tax than needed.
3. Why do I have a PTA?
A PTA usually occurs if you have either:
- achieved a lower Statutory % than was anticipated at the start of the FBT year, or
- claimed ‘Days Unavailable’ during the FBT year.
A PTA can also occur if you have been deployed in a declared a tax-free zone during the FBT year; please note this applies to Australian Defence Force employees only.
Note: You can identify the amount of post-tax collected for your salary packaged vehicle on your End-Of-Year (EOY) report under the column called ‘Post-tax contribution collected’.
4. How is my PTA adjusted?
If you are eligible for a PTA it will be adjusted by one of the methods detailed below:
- PTA is 'claimed' – the PTA is processed like an ordinary salary packaging claim, i.e.:
- A direct payment is made to you from your salary packaging account balance. Your PTA is adjusted using this method only if Smartsalary determines that you have sufficient available balance to meet ongoing vehicle expenses after the PTA is paid.
- If you do not have sufficient balance available in your salary packaging account, the PTA can be deducted pre-tax over a number of pay periods nominated by you. The deducted funds are then paid directly to you 1-2 days after your pay day.
- Roll forward – your PTA can be “rolled forward” and applied to the new FBT year: i.e. your post-tax deductions for the remainder of the new FBT year will be reduced.
Note: Where no nomination is made by you, Option 2 will be utilised so that you don’t miss out on your PTA. Regardless of which method is applied you will receive the same Post-Tax Adjustment.
5. When will my PTA be available?
Your Post-Tax Adjustment will be available late May/early June and further details will be sent to you closer to the date.
6. How will I know which method will be available to me?
In May you will receive a communication from Smartsalary that details how your adjustment will be made based on your individual salary packaging account circumstances.