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Late termination payment

Last updated 27 May 2013

A late termination payment is a lump sum payment, similar to employment termination payments (ETPs) referred to in question 4, which you received more than 12 months after the time you retired or ceased employment.

A late termination payment is treated as an ETP where:

  • legal action about your entitlement to the ETP or about the amount of the ETP was commenced within 12 months of the termination of your employment,
  • the payment was made by a person who was appointed within 12 months of your employment termination as a liquidator, receiver or trustee in bankruptcy for the employer, or
  • the payment was due to a person's membership in a redundancy trust and the application for payment was made within 12 months of becoming entitled to the payment under the rules of the trust. The trustee of the redundancy trust must make the payment as soon as practicable after receiving the application and within 2 years of the termination of the employment that led to the entitlement.

If these conditions are not met, and you received the payment more than 12 months after termination of your employment, then you must show the amount of the payment at item 1 on your tax return.