Money for Australian police
home loans, tax, insurance and shift-work budgets

Most money questions from police come back to the same issue. A large share of your income can come from a roster allowance, per-shift penalties and overtime, and every institution treats that differently. A lender may count all of it, part of it or none of it. The ATO taxes all of it. An income protection policy may or may not insure it.

So before any big decision, know your pay in layers: base, loading, roster allowance, penalties, overtime. The take-home pay calculator splits it out for your force and roster.

Three lenders advertised LMI waivers police can use when we checked, all capped at 90% LVR. P&N Bank's is limited to people employed in WA, buying in listed WA areas, who apply direct and have finished probation. People First Bank's is for sworn officers, on loans up to $1.2 million, at its above-80% LVR rate. BankVic advertises waivers to 90% but its footnotes and first home page add conditions you should confirm.

The police-founded mutuals, Police Bank, QBANK and Police Credit Union, mostly offer fee, rate or service benefits rather than LMI waivers. Our police home loans guide has the full lender table and worked examples, and the LMI waiver guide lists every condition.

These figures understate what many officers can borrow, because they ignore allowances. In Queensland, the Northern Territory, Tasmania and the AFP, roster or composite allowances add a large amount on top of the headline rate, and a lender that counts them will lend more. In NSW and Victoria, the loading is already inside the headline figure.

The Australian Government 5% Deposit Scheme lets eligible first home buyers buy with a 5% deposit and no LMI, under location price caps, with no income cap. Help to Buy is a shared-equity scheme with a 2% minimum deposit and income limits. Neither is police-specific, and both work through participating lenders, which include all five police-founded banks.

Check the government scheme before chasing a police LMI waiver: for a first home, it can mean half the deposit.

Police are taxed like any other employee: allowances, penalties and overtime are all assessable income. The ATO publishes a guide to police income and work-related deductions, and its test for any claim is three golden rules: you spent the money and weren't reimbursed, it relates directly to earning your income, and you have a record.

Higher-ranked officers pay a higher marginal rate on each extra dollar of overtime, so a deduction is worth more to them. Back pay from a new pay deal can look heavily taxed when it lands; the back pay guide explains how it's treated. Salary packaging rules differ by force and employer. Each topic has its own guide above.

Before you buy income protection or life cover, find out what you already have. Some forces have their own schemes; in others, cover comes through the default insurance in your super fund. The table below is the first line of each force's insurance note in our data.

Lenders like to see genuine savings, and a habit of saving your variable pay is exactly that. Our guide to budgeting on shift work walks through it, and the shift work and health guide covers the rest of roster life.

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