An important update to your benefits
The Australian Government and the Australian Taxation Office (ATO) have announced changes to the way certain work-related expenses are treated for salary packaging purposes.
From 1 April 2027, eligible work-related expenses that can currently be salary packaged will no longer be available.
Instead, from the 2026-27 income year, a new standard deduction for work-related expenses will be introduced, also referred to as the $1,000 instant tax deduction. Giving you the option to claim eligible work-related expenses through your next annual tax return from July 2027.
You can learn more on these changes on the ATO website.
What benefits does this change apply to?
This change applies to the following work-related salary packaging benefits. The exact benefits available to you are determined by your employer.
- Personal electronic devices including tablets, smartwatches and mobile phones
- Self-education
- Work development travel
- Home office expenses
- Computer software
- Tools of trade
- Work-related equipment
- Work-related uniforms
- Briefcase
What is the timing of these changes?
- Standard $1,000 deduction: Applies from the 2026-27 income year. Eligible work-related expenses first claimable on tax returns from July 2027.
- Salary packaging change: Applies to Fringe Benefits Tax (FBT) years from 1 April 2027.
- Until then? Current salary packaging of these items continues unchanged.
What you need to do
Work-related expenses can still be salary packaged under the current arrangements until 31 March 2027.
If you're thinking about a new smartwatch, tablet or mobile phone, explore your salary packaging options before the changes take effect*.
Provided your employer offers this benefit and the device is used more than 50% of the time for work purposes, you could access the current salary packaging tax benefits until 31 March 2027. Eligible devices are determined by your employer.
Disclaimers
* Subject to your employer’s salary packaging policy. As per ATO guidelines, portable electronic devices must be used primarily for work purposes (over 50%) to be salary packaged. You can salary package one portable electronic device of each type this FBT year (1 April – 31 March). Tax savings achieved through salary packaging will depend on your income tax bracket and personal circumstances. Visit https://sagov.smart.com.au/benefits/portable-electronic-devices/ for more information.