Jacob, who is aged 59, is reaching retirement. He has about $500,000 in his superannuation fund and would like to increase the amount in superannuation so that he could draw down a pension when he retires. Jacobs annual salary package is $240,000 and he also earns income from a business he owns as a sole trader. The assessable income of the business is $80,000 per annum and it makes a profit of $45,000 per annum, which is included in Jacobs taxable income. For the 2019/20 financial year, Jacob has decided to salary sacrifice the maximum amount for his age.

Is it worthwhile for Jacob to salary sacrifice $25,000? What are the advantages of salary sacrificing compared with making a contribution to superannuation from Jacobs after-tax salary?