Use the PAYG payment summary – employment termination payment form (NAT 70868) if you make an employment termination payment (ETP) to:
- an employee whose employment has been terminated
- a non-dependant because of an employee's death
- a dependant because of an employee's death if the taxable component of the payment exceeds the ETP cap
- a trustee of a deceased employee's estate.
If more than one type of ETP is made, you will need to complete a separate payment summary for each payment.
If the ETP is for a payment made prior to 1 July 2012, you must use the PAYG payment summary – employment termination payment (NAT 70868) form.
You will also need to refer to the earlier How to complete the PAYG payment summary – employment termination payment (NAT 70996) (PDF 111KB)This link will download a file instructions.
Do not use the PAYG payment summary – employment termination payment form for amounts you have withheld from payments of unused annual leave and long service leave.
You don't have to give your employee a PAYG payment summary – employment termination payment if you reported and finalised the amounts through Single Touch Payroll.
- Tax table for employment termination payments
- Employment termination payment (ETP) codes
- Finalising your STP data
To obtain a printed copy of the form, you can either:
- download the form and print in A4 size – PAYG payment summary – employment termination payment (NAT 70868) (PDF 233KB)This link will download a file
- use our automated self-help publications ordering service at any time. You need to know the full title of the publication to use this service
- phone our Publications Distribution Service on 1300 720 092 between 8.00am and 6.00pm Monday to Friday. Before you phone, check whether there are other publications you may need – this will save you time and help us. You need the full title for each publication you order.
To complete the PAYG payment summary – employment termination payment form (NAT 70868) you must:
- write each letter in a separate box
- use a black pen
- use BLOCK LETTERS.
You do not have to complete every field. For example, where an amount has not been paid or withheld, leave those boxes blank.
Show all amounts in whole dollars – do not show cents. For example, show an amount of $122.76 as $122.
When you send the payment summary to us as part of your pay as you go PAYG withholding payment summary annual report, send the ATO original. We cannot accept photocopies or duplicates.
Payment summary for year ending 30 June
You must show the year as a four-digit figure. For example, show the year ending 30 June 2019 as 2019 and not 19.
If the payment is due to the death of an employee, the payee is one of the following:
- trustee for the deceased employee's estate
- non-dependant of the deceased employee
- dependant of the deceased employee.
If you are the trustee for the deceased employee's estate, include your details at payee's surname or family name.
You must show the tax file number (TFN) the payee quoted in this field. For example, show a nine-character TFN as:
To help us process this form, you must substitute the TFN with one of the numbers listed below if:
- a new payee has not made a TFN declaration, but 28 days have not passed – use 111 111 111
- the payee is under 18 years and earnings do not exceed $350 per week, $700 per fortnight or $1,517 per month – use 333 333 333
- the payee is an Australian Government pensioner – use 444 444 444
- the payee chose not to quote a TFN and has not claimed an exemption from quoting a TFN or does not fit into any of the above categories – use 000 000 000.
Separate the surname or family name from the given name (or names) and print in the boxes. For example, show Jane Mary Covers as:
This is the address for the recipient of the payment. You must show the street number and name, suburb/town/locality, state or territory and postcode separately in the boxes provided.
For example, show the address 2 Bell St, Ablem WA 6999 as:
Provide this information if you have it. Leave blank if the payment is a death benefit termination payment.
Use the format DDMMYYYY, for example:
- Date of payment
- Total tax withheld
- Taxable component
- Tax-free component
- Employment termination payment (ETP) codes
Show the date you made the payment to the payee.
Use the format DDMMYYYY.
For example, show the payment date of 25 September 2013 as:
Show the total tax withheld in whole dollars.
For example, show $12,672.70 as:
Include the total of the payment, less the tax-free component. Show the taxable component in whole dollars.
For example, show a taxable component of $34,221.89 as:
For death benefit ETP's paid to a dependant of the deceased, only include the amount over the ETP cap in the taxable component. The ETP cap is $180,000 for the 2014–15 income year.
For example, show the taxable component of a death benefit employment termination payment of $210,000 paid to a dependant as:
$30,000 is the amount over the ETP cap of $180,000.
You do not have to complete this field.
The tax-free component consists of the:
- pre-July 1983 segment
- invalidity segment.
Show the tax-free component in whole dollars. For example, show a tax-free component of $6,594.55 as:
Read through all the information below before selecting the code that best describes the type of employment termination payment being made.
If more than one code applies to the payment, you will need to complete a separate payment summary for each code.
Is this payment a life benefit ETP?
A life benefit ETP is a lump sum payment made to a living employee in consequence of their employment being terminated. Where no payment had been made to your employee in a previous income year for the same termination, then complete either code R or code O, whichever code best describes the payment being made.
Is this payment part of a payment made in an earlier income year for the same termination?
If the life benefit ETP is related to a payment made in an earlier income year for the same termination of employment, then complete either code S or code P, whichever code best describes the payment being made.
Joe's employment was terminated on 30 April 2018. He is entitled to a $200,000 ETP, made under an early retirement scheme.
On 1 May 2018 (2017–18 income year) Joe's former employer pays $150,000 of his entitlement. On 31 July 2018 (2018–19 income year) Joe receives the remaining $50,000 of his entitlement.
Joe's former employer completes the PAYG payment summary employment termination payment (from 1 July 2014) (NAT 70868) for the 2018–19 income year for the remaining $50,000 paid in that year. They select code S as they also made a code R type payment to the employee in a previous income year for the same termination.End of example
Is this payment a death benefit ETP?
If you are paying the ETP to a person because of another person's death, select either codes D, B, N or T, whichever code best describes the payment being made.
Type of death benefit
A death benefit's dependant (code D) is any of the following:
- the deceased person's spouse or de facto spouse
- the deceased person's former spouse or former de facto spouse
- the deceased person's child who is less than 18 years old
- any other person who was a dependant of the deceased just before they died
- any other person the deceased had an interdependency relationship with just before they died.
Spouse of the deceased includes all of the following:
- another person (of any sex) with whom the deceased was in a relationship that was registered under a law of a prescribed state or territory
- another person (of any sex) who lived with the deceased on a genuine domestic basis in a relationship as a couple.
Child of the deceased includes all of the following:
- an adopted child, stepchild or ex-nuptial child of the deceased
- a child of the deceased's spouse
- someone who is a child of the deceased within the meaning of the Family Law Act 1975 (for example, a child who is considered to be a child of a person under a state or territory court order giving effect to a surrogacy agreement).
A death benefits non-dependant is any person who does not fall into one of the categories of dependant listed above.
If the payment was made to a non-dependant, select code N.
You do not have to withhold an amount from a death benefit termination payment paid to the trustee of a deceased estate. However, you must issue a payment summary to the trustee for the taxable component and include the payment summary as part of your PAYG withholding payment summary annual report.
As a payer, you must have either an ABN or WPN. Show your ABN or WPN as it appears on your activity statement.
For example, show an ABN of 12 345 678 912 as:
If a business has one ABN but multiple branches, each branch may have an individual branch number. Show your branch number in the boxes provided. If you do not have a branch number, leave the boxes blank.
Show your name as it appears on your activity statement.
For example, show ABC Pty Ltd as:
Only the payer or a person authorised to sign on the payer's behalf can sign. You can print or type the name of the person authorised to sign the form. You must keep details of the authorised person with your records.
For details about the personal information we collect from you see Privacy notice – PAYG payment summary – employment termination payment.
PAYG Payment summary – employment termination payment (from 1 July 2012) form is self-duplicating and includes copies for:
- the payee
- the payer.
- give the payee their copy of this payment summary within 14 days of the payment being made
- send the ATO original to us along with your PAYG payment summary statement as part of your PAYG withholding payment summary annual report by 14 August, following the end of the income year. The postal address is on the PAYG payment summary statement
- retain the payer copy and keep this for five years.
Do not send us payment summaries printed from your payroll software. You must send us the ATO originals.
Note: Payees no longer have to lodge a copy of their payment summary with their tax return.
If you are not required to report via Single Touch Payroll (STP) and your payroll software meets our specifications, you can submit your payment summary information to us online using Online services for business. It is a quick and secure way for you to meet your lodgment obligations. You will need to set up your myGovID and establish your authorisation using Relationship Authorisation Manager (RAM).
By doing this, you do not need to send copies of payment summaries to us, or complete a PAYG payment summary statement.
You cannot change the information on a payment summary after you have either:
- given it to the payee
- provided your PAYG payment summary annual report to us.
How you correct a mistake depends on what type of mistake it was.
- PAYG withholding payment summaries – corrections for incorrect type of form, payee or payer details, TFN, dollar amount, payment type or code, and how to lodge your amendments