Lump sum payments in arrears

What is a lump sum payment in arrears?

These payments relate to an earlier income year or years and should normally be shown at ‘E’ on your PAYG payment summary – individual non-business.

The lump sum payments you received could be any of the following:

• back payments of salary or wages that accrued in a period more than 12 months before the date of payment
• salary or wages that accrued during a period of suspension and were paid to you on resuming duty
• back payments of non-superannuation annuities that accrued, in whole or in part, in an earlier year or years of income
• repatriation and social welfare pensions, allowances or payments, including those paid by foreign governments
• periodical workers and accident compensation payments but not payments made to the owner of the policy, and/or
• Commonwealth education or training payments.

Tax offset for lump sum payments in arrears

You may get a tax offset if you received certain lump sum payments in 2008–09. We will calculate the tax offset for you. You need to provide additional information - the amount of the payment in arrears for each income year involved - with your tax return.

If you did not need to lodge a tax return for the two most recent years that the payment related to, include details of what your taxable income – including your lump sum payments in arrears – would have been had you lodged tax returns in those two years.

What to read/do next

Lump sum payments in arrears tax offset calculator.

If you need help applying this information to your own situation, phone us on 13 28 61.

Last Modified: Tuesday, 30 June 2009