Reasonable benefit limits (RBLs) will be abolished.
A payment will generally need to be received within 12 months of the termination to qualify as an employment termination payment.
Employment termination payments (other than those made under the transitional arrangements) will not be able to be contributed or rolled over into super.
Life benefit employment termination payments:
will not be subject to tax on any tax-free component (invalidity or pre-July 1983 amounts), or
will be concessionally taxed up to a cap of $140,000 for 2007–08 (to be indexed).
The tax treatment of death benefit employment termination payments will depend on whether they are made to a dependant or non-dependant and how much is paid.
From 1 July 2007, if an employee stops working for you and you make a lump sum payment to them as a result of their employment terminating, the payment may qualify as an employment termination payment.
For copies of our publications, phone the publications ordering service on 1300 720 092.
To speak to a tax officer, phone our information line on 13 10 20 between 8.00am and 6.00pm, Monday to Friday.
You may write to:
Australian Taxation Office
PO Box 3100
Penrith NSW 2740
If you do not speak English well and want to talk to a tax officer, phone the Translating and interpreting service on 13 14 50 for help with your call.
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