An encoder/decoder is described using enhanced signaling mechanisms SAO parameters. The various parameters are signaled in various ways according to different embodiments of the invention. In a first embodiment (embodiment A), SAO on/off is decoupled form SAO type coding, with SAO on/off flags being jointly encoded for all color components. The second embodiment (embodiment B), is similar to embodiment A, but modified for application to JCTVC-J0268. In a third embodiment separate signaling is provided for SAO on/off, SAO types BO and EO, and for BO and EO side information (classes or band position). Each of these enhanced SAO signaling mechanisms provide enhanced coding efficiency.