If you haven’t been keeping up with the news you may not know that Queensland will be the first state to offer tax-free transport. But before you go nuts with topping up your GoCard, here are 4 things to know about how it works and whether it can help you when you contact one of our income tax professionals to do your tax lodgement.
Are you eligible?
The first thing you need to do is find out from your employer if you are affiliated with the salary-packaging provider RemServ. You may also be eligible if you work within a government department.
If you said “Yes” to either of those options the next step is setting up salary sacrifice. If you’ve said “No” – don’t panic. Our professional tax consultants can still help you claim travel as a possible tax deductible.
How does it affect your salary?
Instead of being taxed on your use of public transport you can salary sacrifice your gross payment before tax. By setting up an allotted amount for each pay cycle to be salary sacrificed you will always have the funds to take the bus, train or ferry. What’s even easier is through salary sacrifice your transport will all be recorded in your pay slip. That less receipts and and logbooks to bundle up and bring to your nearest ITP store.
How do you use it on a day-to-day basis?
Even though this option has been available from a legislative sense for six years only now is the state government rolling out a way to make this benefit functional to everyday, working Australians. But at last the Bus Travel Benefit smartcard is on it’s way. Once you have your salary sacrifice organised through your employer, the salary sacrifice will periodically transfer your nominated funds to the card. It’ll operate in the same way a GoCard does, but there will be no need to top up constantly. Pilot trials are underway and the Bus Travel Benefit smartcard is scheduled to go live in a few months.
What are the benefits for you?
The removal of tax from your public transport will help you save upward of hundreds of dollars each year. You can leave the car parked at home to opt for a more affordable ride to work. Less petrol fares, parking fees and other expenses that come with driving the car each day means a little bit more of your cash stays in the wallet. Of course, the biggest effect of more Australians being incentivised to take public transport is restoration to our environment. By pushing down the number of vehicles on the road over time we’ll be able to see less emissions too. Of course, removing the hassle of topping up your GoCard and moving towards more streamlined, automated processes means a little bit more peace of mind for you too.