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  • Terms we use



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

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    Additional payments

    Additional payments include back payments (including lump sum payments in arrears), commissions, bonuses and similar payments.

    Normal earnings

    Normal earnings are gross taxable earnings and include all salary and wage income, taxable allowances, and overtime earnings for the current financial year. This includes any back payments previously made using Method B (i).

    At the start of a financial year, a payee’s normal earnings can be based on the last full pay period worked in the previous financial year.

    If a payee’s pay fluctuates significantly, you can use an average of gross taxable earnings for the current financial year (or, if applicable, the previous financial year).

    If a payee has no current or past normal earnings (for example, the payee is newly employed), you can include expected future earnings in your calculations. This can be based on the payee’s contracted or expected salary for the financial year.

    For the purposes of this table, normal earnings do not include employment termination payments or unused leave payments made on termination of employment.

    Average total earnings

    Average total earnings are the sum of all normal earnings paid in the current financial year, including current pay, plus any current year back payments if Method B (i) is used to calculate withholding. Then divide the total earnings by the number of pay periods to date (including the current pay period).

    Pay periods per financial year

    Pay periods per financial year refers to a total of 52 pay periods if paid weekly, 26 pay periods if paid fortnightly or 12 pay periods if paid monthly. No adjustments are required for a 53 week / 27 fortnight year.

    Last modified: 29 Oct 2013QC 34732