Taxation - Employment termination payments

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• Taxation of payments to departing employees
  The taxation of payments you make to departing employees will depend on what the payment is and why the employee is leaving your employment.
  Mar 09, 2020

• What payments are made upon voluntary resignation, dismissal or retirement?
  When an employee leaves due to voluntary resignation, dismissal or retirement, you must make the following payments to the employee.
  Mar 09, 2020

• Taxation of annual leave payments
  If your employee’s employment ends due to voluntary resignation, dismissal or retirement, you will need to calculate the pay as you go (PAYG) amount to be withheld from their unused annual leave and leave loading payments.
  Mar 09, 2020

• Step-by-Step: How to calculate tax on annual leave payments
  Take the following steps to calculate PAYG withholding tax for annual leave.
  Mar 09, 2020

• Taxation of long service leave payments
  How a payment for unused long service leave (LSL) is taxed will depend on when the leave was accrued.
  Mar 09, 2020

• How to calculate tax on long service leave payments
  If you are making an unused LSL payment and an unused annual leave payment, you only need to do two PAYG withholding calculations once you have worked out the amount in each of your LSL categories.
  Mar 09, 2020

• Taxation of employment termination payments
  Employment termination payments (ETPs) are taxed at different rates depending on an employee’s age and how long they were employed with you.
  Mar 09, 2020

• How to calculate tax on ETPs
  You do not need to withhold PAYG withholding from ETPs in certain situations.
  Mar 09, 2020

• Using the ETP cap
  The ETP cap is the maximum amount of an ETP that will be taxed as a concessional payment.
  Mar 09, 2020

• Using the whole-of-income cap
  The whole-of-income cap for 2019–2020 is $180,000, less any other taxable income an employee earns throughout the financial year.
  Mar 09, 2020

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