SALARY PACKAGING SERVICES FOR EMPLOYEES TERMS & CONDITIONS
This document sets out Terms & Conditions upon which Smartsalary Pty Limited (‘Smartsalary’) provides salary package services to you.
1. Definitions and Interpretation
‘Business Day’ means a weekday on which banks are open for business in Sydney, Australia.
‘Salary Package’ refers to your salary package comprised of a cash component and other benefits
selected by you and administered by Smartsalary in accordance with these Terms & Conditions.
‘Salary Packaging Services’ (or ‘Services’) are the salary packaging services provided to you by Smartsalary (and third party providers) and include:
- provision of information to you to assist you in selecting a Salary Package;
- information as to how your Salary Package will be administered;
- administration of your Salary Package;
- payment of benefits selected by you that form part of your Salary Package;
- reporting to you on your Salary Package; and
- additional services as determined by Smartsalary from time to time and notified on its website or as otherwise approved by your employer.
Only benefits identified in an approved list of benefits notified by Smartsalary on its website as part of the Services and updated from time to time or benefits otherwise approved by your employer may be salary packaged through Smartsalary.
The Services do not include the provision of financial advice to you. Smartsalary is not (and will not be) your agent, or otherwise act in a trustee or fiduciary capacity on your behalf.
Upon change in any applicable law, if it is determined by Smartsalary that the provision of the Services, or any relevant Service, is no longer compliant with any applicable law, Smartsalary may discontinue administering the relevant Service or alter the way it is being administered to comply with the relevant laws.
The Services come with guarantees under the Australian Consumer Law that cannot be excluded or restricted by these Terms & Conditions and any clause that excludes or restricts your rights under those guarantees is subject to the Australian Consumer Law.
2. Acceptance and Term
- The Services will be provided to you from the date when your completed application form is received by Smartsalary and until such time as a Service is terminated in accordance with these Terms & Conditions and the Agreement for the Provision of Salary Packaging Services with your employer (‘Employer Agreement’). By completing the application form you are indicating your agreement with and understanding of these Terms & Conditions.
- The application form may be completed:
- in writing by obtaining the form from Smartsalary’s website or in hard copy from other authorised sources; or
- electronically by completing the form on Smartsalary’s website; or
- verbally, over the telephone with the Smartsalary service centre.
- The information provided by you in the application form must be true, complete and accurate. This includes, without limitation, your current salary and wages information. You must inform Smartsalary immediately of any changes to the information provided by you in the application form.
- You acknowledge that certain changes to your salary packaging arrangements, as instructed by you, can be made over the telephone without the requirement for the change to be effected or confirmed in writing.
- Smartsalary or your employer may request re-substantiation of the benefits that are part of your existing salary packaging arrangement. You must keep records of the information provided as part of your application for salary packaging with Smartsalary or a claim made pursuant to your Salary Package for five years from the date when you lodge the application or claim.
- Where your employer has undertaken to transition from an existing packaging arrangement and has provided the relevant information to Smartsalary on transition, an application form may not be required.
3. Benefit providers
- Smartsalary engages various third party providers to be available to provide the Services to you as part of your salary packaging arrangement. Where Smartsalary has a panel of providers, you must select such a provider from the panel.
- Smartsalary may change the list of third party providers from time to time and will provide notification of any such changes on its website. Where your selected provider is removed from the list, Smartsalary may, at its election, substitute such provider with a suitable alternate provider to provide the relevant product or service to you.
- When the amount received from your salary is less than the payments Smartsalary must make on your behalf to third parties, some of the payments to those third parties will remain outstanding. When Smartsalary receives further payments from your salary, any outstanding payments to third parties will be prioritised before reimbursements are made to you.
- Where you have a previous existing arrangement with a provider not included in Smartsalary’s list of providers, you may be required to transfer your provider to one of the providers on the panel before you can commence your salary packaging arrangements with Smartsalary.
4. Salary Packaging Bank Accounts
- Upon acceptance of these Terms & Conditions, you acknowledge that your employer will pay that part of your Salary Package as is necessary for Smartsalary to administer the Services to you into a bank account (‘Salary Packaging Bank Account’). You expressly acknowledge that any funds held in the Salary Packaging Bank Account are held on behalf of your employer (and are not held on your behalf or on trust for you.)
- Smartsalary will have an authority to transact on the money held in the Salary Packaging Bank Account for the purposes of administering the Services to you.
- You will not be permitted to make any direct debit transactions against the Salary Packaging Bank Account. Monies held in the Salary Packaging Bank Account do not accrue interest to you and Smartsalary may retain any interest that does accrue.
- Monies deducted from your salary and held in the Salary Packaging Bank Account can be paid to you and taxed at any time of the year in accordance with your employer’s salary packaging policy.
5. Fees for administration of Services
- As determined by your employer, either you or your employer may be responsible for fees payable to Smartsalary for administration of the Services.
- Where you are responsible for paying the fees:
- you acknowledge that current fees are shown on Smartsalary’s website;
- you acknowledge that Smartsalary may increase the fees in accordance with the Employer Agreement. If you do not agree to any increase in fees, you may terminate the Services by giving one month’s notice in writing to Smartsalary.
- you authorise and consent to Smartsalary deducting the fees from monies held in the Salary Packaging Bank Account in priority to other payments.
- Subject to your employer’s policy, if you terminate the Services throughout the year, which, for the purposes of the Services, is a Fringe Benefits Tax (FBT) year from 1 April to 31 March, the full annual administration fee is payable to Smartsalary for the Services terminated.
- Subject to your employer’s policy, if you elect to maximise your salary packaging cap at any time within a year, which, for the purposes of the Services, is a Fringe Benefits Tax (FBT) year from 1 April to 31 March, the full annual administration fee will be payable to Smartsalary for the participating periods in which the salary packaging cap is maximised.
- Subject to your employer’s salary packaging policy, where you have transferred from one employer to another and this transfer allows an additional amount of living expenses threshold to be packaged, you will be charged the full annual fee in each employer entity irrespective of whether you choose to utilise the extra threshold allowed or limit your packaging to a lesser amount than available. For the purposes of this clause, living expenses threshold refers to the additional tax concessions available to employees of Public Hospitals, Charities, Aged Care Homes and Medical Research Institutes in respect of living expenses as prescribed by the Australian Taxation Office from time to time. This is not available to the general work population.
- An employer’s salary packaging policy may require that the balance attributable to an employee in the Salary Packaging Bank Account cannot exceed a certain amount. If your employer has such a policy, any funds in excess of that maximum balance will be returned to your employer to be paid as salaries and wages and taxed at any time of the year in accordance with your employer’s salary packaging policy.
6. Account administration
- a. You agree to review the confirmation report or any communications provided to you by Smartsalary by email, post or on Smartsalary's website and to notify Smartsalary of any errors or changes required, including, but not limited to, packaging amounts being deducted, scheduled payments, bank account details and the accuracy of creditors and data regarding vehicles.
- b. If you are eligible to make capped benefits claims, Smartsalary does not guarantee that any such claims lodged after the 28th February in any FBT year will be processed prior to the end of that FBT year. ‘FBT Year’ is a period from 1 April - 31 March.
- c. Where you request an amount from your salary to be deducted for a specific benefit in a pay period and this amount exceeds your actual allowable base salary for that pay period, no deduction of funds will then be guaranteed and Smartsalary will not be liable or responsible for any associated loss (including but not limited to any tax or interest loss).
- To the extent permitted by law including the Australian Consumer Law, Smartsalary will bear no loss or any responsibility resulting from any data entry errors where a confirmation report was issued and you were given an opportunity to identify and correct such errors unless you can demonstrate that you have made reasonable efforts to make Smartsalary aware of such errors.
- In relation to the Superannuation Concessional Contributions Caps (‘SCCC’) as may be set by the Australian Taxation Office from time to time, Smartsalary will bear no loss or any responsibility resulting from any breach of the requirements related to those SCCCs or from any contributions made in excess of the SCCCs though your Salary Package. You agree to monitor the requirements for, and values of, the applicable SCCCs and make adjustments to your Salary Package where required to comply with those.
- You must notify Smartsalary of any changes to bank account details immediately. Failure to do so will result in any cost associated with recovering or redirecting payments, as well as any bank fees, interest or charges that result, being charged to you.
- If funds are not received three consecutive pay periods, your Smartsalary account may be automatically ceased. If you are taking any type of leave without pay, you must notify Smartsalary as soon as practicable, and in any event, before taking leave, so we can make required adjustments to your account.
- Where you send a claim for reimbursement of expenses, you must keep a copy of the claim and any supporting documents you submit. Smartsalary will not return any original documentation to claimants, including rejected claims. If you request Smartsalary to return a copy of any transaction submitted, the expense in performing this request will be borne by you. Smartsalary will inform you of any such expense prior to any request being performed. You must inform Smartsalary of any inaccuracy in relation to a claim processed within 2 months of submission of any such claim.
- Where the benefits agreed to form part of your salary package, as detailed in your application, are unable to be provided for whatever reason, including but not limited to there being insufficient supporting documentation to evidence the relevant expenditure, or a benefit is no longer a relevant expense for you, then the remaining funds are to be allocated in the following order of preference, where possible:
- Novated Lease;
- General Living expenses;
- Meal Entertainment and Holiday Accommodation;
- Portable Electronic Device;
- Car Parking (employees of PBI and Rebatable organisations only).
Any remaining funds which cannot be allocated as per the above, may be returned to your employer to be paid as salaries and wages, at any time of the year, and taxed in accordance with your employer’s salary packaging policy.
7. Packaging vehicles
- Where your employer offers the Novated Lease Vehicle benefit, and you have elected to package a Novated Lease Vehicle benefit, it is a condition of entering into a Novated Lease that you purchase all fuel on a Smartsalary approved fuel card. This is to reduce the risk of an FBT liability and enable accurate and timely reporting on your Salary Package.
- The only fuel purchases allowed to be claimed manually are those purchased while awaiting the issue of the Smartsalary approved fuel card or where the card was not able to be used and the purchase was urgent, for this purpose you are able to submit four (4) fuel claims per FBT year (1 April – 31 March).
- If you have organised a Novated Lease through a financier which does not comply with Smartsalary’s conditions set out on its website, you may not be eligible to package the benefit. If Smartsalary exercises its discretion to allow for the inclusion of such lease in your Salary Package, a charge of $200 (plus $20 GST) will apply to cover additional administration involved.
- Where you package a Fully Maintained Novated Lease by a provider other than Smartsalary and therefore are not issued with a Smartsalary fuel card, you are required to declare your odometer reading to Smartsalary no less frequently than once every 3 months (January, March, July and October). This will enable Smartsalary to track your kilometres against your budget and identify any potential FBT liability at the end of the FBT year. A ‘Fully Maintained Lease’ refers to a vehicle lease, which is comprised of a financed lease component, operating costs and other products selected by you and administered by another leasing company.
- It is your responsibility to ensure that your Novated Lease vehicle is insured at all times, even where that insurance has been organised by Smartsalary through its fleet insurance provider. In particular you should be aware that where you indicate to Smartsalary at any point during your Novated Lease Vehicle application process that you have obtained, or will obtain, your own insurance, then Smartsalary will take no responsibility for ensuring that this is in fact the case, and will not set up replacement insurance for you should your self-sourced insurance expire prior to the end of the lease agreement (unless you contact Smartsalary to specifically request this).
- To the extent permitted by law including the Australian Consumer Law, if your vehicle is uninsured at any time during your Novated Lease agreement, Smartsalary will not be liable for any direct or consequential costs you incur as the driver or owner of that vehicle.
- Effective from 1 April 2011, where you make after-tax recipient payments under sections 9(2)(e) or 10(3)(c) of the Fringe Benefits Tax Assessment Act 1986, the amount of the recipient payment will be applied to your car fringe benefit to the extent required to reduce the taxable value of the car fringe benefit to nil in each FBT year.
- Where you have an excess post-tax contribution and Smartsalary adjusts your account to refund the excess post-tax amount, we will not compensate you for the value of any ‘contribution GST’ paid on the initial post-tax contributions.
- If you elect to exit your novated lease agreement earlier than the scheduled end date for any reason, Smartsalary will not be held responsible for any charges, fees or penalty amounts payable to the lease financier as a result of the early exit, including any residual amount or part thereof.
- Under the Smartleasing vehicle Registration Renewal Program you will be responsible for all the necessary actions up until the registration payment. This includes, where necessary, arranging safety checks, ensuring issuance of a certificate of roadworthiness and delivery of the original safety inspection report to the state-based Motor Registry office. You are also responsible for supplying all relevant completed documents for payment to Smartleasing at least 10 days prior to the vehicle registration expiry date. Smartleasing may send you reminder communications, but these should not be relied upon. Where these conditions are not met, or your paperwork is insufficient, Smartleasing will not be held liable to make the registration payment and you may be removed by Smartleasing from the vehicle Registration Renewal Program. As part of the program, you are giving authorisation for Smartleasing (a registered trading name of Smartsalary Pty Ltd) to act on your behalf on matters relating to CTP certificates, vehicle registration certificates and re-registration of the subscribed vehicle(s). This authority is valid until revoked by yourself or until the vehicle is no longer packaged. If you are based in NSW, ACT or QLD, your CTP insurance will be issued by Suncorp (QLD) or GIO (ACT & NSW). Under the Registration Renewal Program, Smartleasing will make payments for registration and CTP insurance in each 12 month period of the program, as separate payments in each period in accordance with the registration and CTP insurance renewal requirements. To unsubscribe from this program, please visit your online account and remove the product from the relevant vehicle(s).
- Where you have packaged a Novated Lease Vehicle under the Statutory Fraction method you must provide to Smartsalary, at each FBT year end and at the end of the lease, a statutory declaration of your vehicle odometer reading if requested. If no declaration is received as required by Smartsalary, FBT will be calculated either using the last valid odometer reading provided by you or at the highest statutory fraction applicable.
- Where you have packaged a Novated Lease Vehicle under the Operating Cost Method you will be required to record, in an approved log book for a continuous period of 12 weeks, details of all business journeys in accordance with the definition of “log book records” as set out in section 136(1) of the Fringe Benefits Tax Assessment Act 1986 and to provide Smartsalary with the “business use percentage” established by the entries in the log book. Where no log book is provided the vehicle will be assumed to be for 100% private use for FBT and salary packaging purposes.
- Where you have packaged a Novated Lease Vehicle under the Operating Cost Method and, subsequent to your keeping of compliant log book records, the use of your vehicle changes materially (as per ATO guidelines), you will be required to record new log book records for a continuous period of 12 weeks and report your revised “business use percentage” to Smartsalary. Smartsalary reserves the right to apply a 100% private use assumption to your salary packaging calculations if there is a reasonable basis for concluding that your vehicle use has materially changed and you have not recorded a new log book.
- Where you have packaged a Novated Lease Vehicle under the Operating Cost Method you must retain your log book records for a period of 5 years from the last recorded entry in the log book, and you must present those records upon request by Smartsalary or your employer.
- As per the current ATO guidelines, you must not claim work-related car expenses with respect to your Novated Lease Vehicle as a deduction on your tax return. You should obtain independent tax advice on any queries you may have about your tax return.
8. Excess Usage
- Where your account is overdrawn for any reason you authorise Smartsalary, with notice to you, to:
- schedule additional deductions from your salary for the specific purpose of crediting your salary packaging account by the overdrawn amount; and/or
- cancel other salary packaging payments due and payable and use the funds earmarked for these payments to cover the overdrawn amount; and/or
- schedule additional deductions from your salary to cover any estimated future spend (as calculated at Smartsalary’s discretion) to prevent future overdrawn amounts; and/or.
- recover the overdrawn amount directly from you.
- Where you utilised goods or services in excess of the balance attributable to you in the Salary Packaging Bank Account (whether due to over usage of your fuel or maintenance card or otherwise), Smartsalary may, with notice to you:
- cancel your fuel card; and/or
- cancel your maintenance card; and/or
- continue fuel deductions to meet debt; and/or
- cancel packaged benefit payments; and/or
- continue lease deductions to meet debt; and/or
- increase salary deductions to meet debts and cover future estimated spend.
- If Smartsalary uses salary packaging funds deducted for the purpose of meeting your lease payment obligations to cover an overdrawn amount, you may be required to make out of package lease payments directly to your lease financier (that is, not through your salary packaging arrangements), whilst your lease deductions are used to repay the debt.
- Where Smartsalary is unable to recover the balance of an excess amount in a timely manner in accordance with the methods set out in section 8(a) or (b), Smartsalary may, at its sole discretion:
- subject to your Employer Agreement, request your employer to fund the balance; or,
- engage a collection agency to recover the debt from you.
- Generally and subject to applicable legislation, Smartsalary is legally entitled to recover amounts with respect to any negative balance or any other amounts owing by you to Smartsalary in the period of 6 years of the debt becoming due (unless the collection of the debt is governed by the laws of the Northern Territory, where the period of 3 years generally applies).f. All reasonable transaction fees and other costs (including, but not limited to, external debt collection agency fees) incurred by Smartsalary in respect of the recovery will be payable by you.
- You must only nominate a reimbursement account which you own or over which you have the authority to permit Smartsalary to direct debit if you exceed the balance attributable to you in the Salary Packaging Bank Account or on a Salary Packaging Card that you have utilised.
9. Salary Packaging Loans
- Where it is necessary to pay a reimbursement amount to you and there is insufficient balance available in your salary packaging account Smartsalary may, at its discretion, elect to:
- loan money to your employer in order to fund your salary packaging account up to the required level; or
- pay the reimbursement even though it will push your salary packaging account balance below zero - i.e. to a debit balance.
- In both of the above cases it is noted that the primary liability to re-pay the loaned funds and/or re-fund your salary packaging account will fall on your employer. However it is a requirement of your salary packaging agreement that you fully compensate your employer within a reasonable timeframe by sacrificing additional pre-tax salary amounts.
- Any pre-tax salary packaging amounts deducted under the authority at 9(b) will be immediately allocated to your salary packaging account or as repayment of the amounts owing to Smartsalary.
10. Fringe Benefits Tax
- You agree to compensate Smartsalary and/or your employer, either by way of additional pre- tax salary deduction or direct payment, for any FBT amounts payable in relation to your salary packaging activities.
- Smartsalary will perform, on an annual basis, a reconciliation between the collected FBT and the calculated liability to pay FBT for each benefit type provided to you and will report such results of this reconciliation to your employer.
- You are responsible for any outstanding amounts of FBT. FBT liabilities will be payable by you through salary deductions, direct credit, or a direct debit arrangement. If you disagree with the amount of FBT payable in a relevant FBT year, you must notify Smartsalary within 21 days of the relevant FBT year.
- It is your responsibility to manage your FBT and maintain your own records of start and end kilometres and or log book for your vehicle. Smartsalary will provide you with reports concerning vehicle usage and potential FBT liabilities resulting from your driving patterns; however, these reports are issued as a guide only.
- If you fail to advise Smartsalary that you are ceasing employment and continue to use your fuel card after termination of employment any such costs will be subject to FBT, and the expenses and FBT will be directly recovered from you.
- Nothing in this clause 10 makes you liable for any FBT amounts payable due to a breach of these Terms & Conditions by, or the negligence of, Smartsalary.
11. Cessation of benefits or Salary Package
- If you would like to cease packaging a benefit or are ceasing employment with your employer, you must notify Smartsalary of such cessation with at least 10 Business Days notice prior to the change.
If at the time of cessation of your salary packaging arrangements with Smartsalary there is any balance remaining in your individual salary packaging account, subject to your Employer’s salary packaging policy, Smartsalary will return those remaining funds to your Employer for reimbursement of that amount (less income tax) to you, subject to your provision of the requisite substantiation to Smartsalary. Smartsalary will email a request for substantiation to the email address that is registered on your account at time of cessation. It is your responsibility to ensure that the email address remains current at all times.
You acknowledge that Smartsalary is entitled to offset the reasonable costs of processing the return of any remaining funds against those funds.
The remaining funds will be forfeited by you and kept by Smartsalary in any of the following circumstances:
- if the reasonable cost of processing the return of funds exceeds the amount of those funds; or
- if you do not respond to our request for substantiation documents within 30 days of the date of our email to you.
- On cessation of your employment, you will not be entitled to receive final termination pay from your employer until Smartsalary has provided a reconciliation of your Salary Package to your employer.
- Where you are ceasing the package of a Novated Lease Vehicle benefit, up to 6 weeks is required for Smartsalary to provide the reconciliation of your salary package. If you have an outstanding balance on a Smartsalary issued fuel card, the amount will be recovered from amounts attributable to you in the Salary Packaging Bank Account. If you still owe a debt after the balance of amounts attributable to you in the Salary Packaging Bank Account has been applied, you will be obliged to pay the outstanding balance and FBT owing.
- You remain liable to your employer for any outstanding amount owed by you on cessation of your Salary Package benefit or at the end of any FBT year.
- On cessation of your employment or your Salary Package or benefit for any reason, Smartsalary may immediately cease provision of the Services or benefit to you. You will be fully responsible to meet any outstanding commitments from the date of such cessation.
- If you in any way misuse a benefit or use it in a manner which is fraudulent or which may constitute a breach of FBT laws and regulations, or you commit a material breach of these Terms & Conditions or become bankrupt, Smartsalary may immediately cease provision of the Service to you by providing you with notice. If you fail to comply with these Terms & Conditions in any other way, Smartsalary may cease provision of the Service to you on at least 10 Business Days' notice.
- Overpayment of GST on contributions will not be refunded in the event of Salary Package or benefit termination. At the end of an FBT year, Salary Package, benefit termination or otherwise, if it is calculated that an employee has made an after-tax contribution in excess of what is required to reduce the FBT liability for their Salary Package to nil, that excess contribution is not refundable to the Employee.
12. Suspension for non payment
If you or your employer fails to make any payment due to Smartsalary, Smartsalary may, with notice to you, suspend the Services to which that overdue payment relates unless and until all such overdue payments are made to Smartsalary.
You acknowledge and agree that:
- Smartsalary (and its affiliates) may receive commissions, rebates or other payments or benefits from third party providers of goods and services who provide such goods and services to you as part of your Salary Package, and as a result of Smartgroup receiving these benefits, you should not expect that any advice or recommendations given by Smartsalary will be disinterested, nor will Smartsalary disclose any conflicts of interest to you;
- Smartsalary is not required to make payments for benefits forming part of your Salary Package or otherwise if there are insufficient funds to make such payments in the Salary Packaging Bank Account and will not be liable for any penalties, interest or other charges payable due to any delay in payment resulting from insufficiency of funds in the Salary Packaging Bank Account;
- all information provided by you to Smartsalary is true and accurate and where any incorrect bank account information is provided, any bank fees and administration costs resulting from that error will be deducted from amounts attributable to you in the Salary Packaging Bank Account;
- you have read the rules for each benefit provided by Smartsalary as part of the Services from time to time and will abide by those rules;
- These Terms & Conditions are updated from time to time by Smartsalary and by continuing to use the Services you are deemed to accept these changes and you are bound by the most current version of the Terms & Conditions published on Smartsalary’s website. If you disagree with any such changes to the Terms & Conditions, you can elect to discontinue the provision of the Services to you and terms of the Terms & Conditions applicable immediately prior to the cancellation by you of the Services will apply to the relationship between you and Smartsalary;
14. Authorisation to Smartsalary
You authorise Smartsalary to:
- in its discretion, change the cash and other components of your Salary Package by providing you with notice but without specific authorisation from you so as to ensure that the Salary Package benefits selected and notified by you to Smartsalary are able to be provided and that any of your contribution to the taxable value of a benefit can be satisfied;
- adjust salary deductions in accordance with benefits packaged by direct interface with your employer’s payroll and with notice to you;
- direct your employer to pay additional monies from your salary into the Salary Packaging Bank Account by providing you with notice but without specific authorisation by you if such additional sums are required in order to pay for the benefits making up your Salary Package; and
- record any telephone conversation(s) between you and Smartsalary.
15. Governing law and jurisdiction
The laws of the State of New South Wales shall govern these Terms & Conditions and the parties submit to the non-exclusive jurisdiction of the courts of New South Wales and the Federal Court of Australia.
Version: 23 March 2022