• 3 - Employer lump sum payments 2014

    This question is about any lump sum payments you received from your employer for unused annual leave or unused long service leave.

    Did you receive any of these payments?

    Attention

    Warning:

    This information may not apply to the current year. Check the content carefully to ensure it is applicable to your circumstances.

    End of attention

    No

     

    Yes

    Read on

    Do not include any employer lump sum payments in arrears or non-superannuation annuity payments in arrears shown at 'Lump sum E' on your payment summary. These amounts are dealt with at question 24 Other income. Similarly, 'lump sum payments in arrears' shown on your PAYG payment summary - superannuation income stream are dealt with at question 7 Australian annuities and superannuation income streams.

    Do not include payments for early retirement or genuine redundancy shown at 'Lump sum D' on your PAYG payment summary - individual non-business anywhere on your tax return, as they are not taxed.

    Answering this question

    You will need your PAYG payment summary - individual non-business, PAYG payment summary - foreign employment or a comparable statement from your payer showing an amount at 'Lump sum A' or 'Lump sum B' where relevant.

    If you do not have all your payment summaries or comparable statements, or if any of your comparable statements do not show an amount you received during the year that is either a 'Lump sum A' or a 'Lump sum B' contact your employer or payer. If you are unsuccessful in obtaining any of these, there is information about making a statutory declaration in PAYG payment summaries - individual non-business.

    If you have received a PAYG payment summary - foreign employment showing an amount at 'Lump sum A' on which foreign tax has been paid you will also need to include the amount at U in item 20.

    Completing your tax return

    If you do not have any amounts shown at 'Lump sum A' on your payment summaries, go to step 4.

    Amounts shown at 'Lump sum A' on your payment summary

    Step 1

    Add up the total tax withheld from lump sum A amounts shown on your payment summaries. Do not include any amounts of tax withheld you have included at any other item, such as item 1 or 2.

    Write the answer under Tax withheld at the left of R item 3.

    Step 2

    Add up all lump sum A amounts on your payment summaries.

    Write the answer at R item 3.

    Step 3

    Print in the TYPE box at the right of R:

    R

    if the amount related to a genuine redundancy payment, an early retirement scheme payment, or the invalidity segment of an employment termination payment or superannuation benefit

    T

    for all other situations.

    Check with your payer if you are not sure.

    If you do not have any amounts shown at 'Lump sum B' on your payment summaries, you have finished this question. Go to question 4 Employment termination payments (ETP).

    Amounts shown at 'Lump sum B' on your payment summary

    Step 4

    Add up the total tax withheld from lump sum B amounts shown on your payment summaries. Do not include any amounts of tax withheld you have included at step 1 above or at any other item, such as item 1 or 2.

    Write the answer under Tax withheld at the left of H item 3.

    Step 5

    Add up all lump sum B amounts on your payment summaries.

    Divide the total by 20 to work out 5% of the amounts. Only 5% of these amounts is taxable.

    Write the answer at H item 3.

    Find out more

    Taxation of termination payments

    End of find out more

    Where to go next

      Last modified: 21 Jan 2016QC 39829