1.1.S.05 Salary sacrificing (CCS)


Salary sacrificing is an arrangement between an employer and an employee where the employee agrees to forgo part of their future entitlement (1.1.E.30) to salary or wages in return for a benefit of a similar value, for example the provision of child care.

Employers may allow employees to salary sacrifice the cost of child care services. If the employer is liable for all or part of the child's child care fees, there is no CCS or ACCS payable for the part of the fees for which the employer is liable. CCS and ACCS are only payable in respect of the fees that individuals (1.1.I.90) are genuinely liable to pay.

The employer may be liable to pay FBT on the reportable fringe benefits provided. This is an area of legislation administered by the ATO.

Policy reference: FA Guide 2.6.1 CCS eligibility

Last reviewed: 2 July 2018