Case Studies
Please read our case studies, and see how we have helped other employees and employers.
Case Study #1: Australian Resident Relocates Interstate
The facts
Joe is a 30 year old BA from Melbourne working in a large organisation in the insurance and finance sector. Colleague Jill, in a similar role in the Brisbane office, is about to take 12 months maternity leave, and Joe is asked if he would move up to sunny Queensland to cover her role. He weighs up the added experience he will gain and the better weather and decides to go for it.
The figures
His annual salary of $105,000 gives him $75,425 after tax. It costs him $2000 to move all his things, and after three weeks in short term accommodation when he first arrives, he rents a unit at Kangaroo Point for $400 per week. Without his employer paying him any increase in salary, the LAFHA tax allowance means he gets an extra $10,401 take home (after tax) pay. This not only covers Joe's move and initial relocation but also gives him a chance to go out and make the most of his new lifestyle.
The Results
Employee Advantages
- Increases take home pay
- Recoups most of the cost of relocation and other out of pocket expenses
- Is motivated and happier at work with additional LAFHA benefits
- Improves work experience with new role and remains loyal to employer rather than moving on
- Does not change employment status
Employer Advantages
- Pays no extra salary or super
- Has no reportable FBT liability (with LAFHA applied correctly)
- Retains satisfied, motivated personnel, becoming an Employer of Choice
- Improves recruitment and retention and builds staff loyalty
- Sees no change in employees' employment status
Case Study #2: International Relocation (457 Visa Holder)
The facts
Patrick is a 33 year old Systems Engineer from Dublin who decides to immigrate to Australia with his family. He finds a job with a large retail head office in Sydney, and his employer sponsors him on a schedule A 457 Visa for four years. He has brought with him to Sydney his wife and two children, aged 4 and 8.
The figures
Patrick's salary of $95,000, exclusive of super, gives him $69,575 take home pay after tax. It costs him $5000 in airfares and additional moving costs, over and above the relocation reimbursement provided by his employer. They move into a two bedroom unit in Randwick which they rent for $400 per week, and they pay $4000 per year in school fees. When LAFHA is applied, without his employer increasing his salary, Patrick's take home (after tax) pay increases by $13,247 in the first year, and $10,412 for the subsequent 3 years. This allows him and his family to enjoy a good standard of living and take advantage of their new outdoor lifestyle.
The Results
Employee Advantages
- Increases take home pay
- Recoups a reasonable proportion of the cost of relocation and out of pocket expenses
- Is motivated and happier at work with additional LAFHA benefits to remain loyal to employer
- Is committed to fulfilling contract and performs at his best
- Does not change employment or visa status
Employer Advantages
- Pays no extra salary amounts, including super or cost
- Has no reportable FBT liability if applied correctly
- Retains satisfied, motivated personnel and becomes known at Employer of Choice
- Improves recruitment and retention of key staff who remain loyal to the company
- Sees no change in employees' employment or Visa status
NB. All figures provided are representative of 08/09 taxation guidelines, and are estimates against individual circumstance.