Tax Table For ETP's

(last updated 05/06/2014)

Related posts:

• Lump Sum Payments on Termination of Employment
• Lump Sum A
• Lump Sum B
• Lump Sum D - Redundancy Payments
• Lump Sum E
• Death Benefit ETP
• Termination Triggers
• Whole of Income Caps
• Tax Table on Unused Leave Payments 
• Tax Table on ETP's
• Tax Table on Superannuation Lump Sum

This table summarises the tax treatment of Eligible Termination Payments (ETP's).

ETP tax tables withholding rates from 1 July 2014

Withholding rates for ETPs

Income component derived by your employee in the income year	Age of person at the end of the income year that the payment is received	Component subject to PAYG withholding	Rate of withholding	Cap to apply
Life benefit ETP – taxable component Payment is because of: early retirement scheme genuine redundancy invalidity compensation for personal injury, unfair dismissal, harassment or discrimination.	Under preservation age	Up to the ETP cap amount1	32%	ETP cap
	Preservation age or over	Up to the ETP cap amount1	17%	ETP cap
	All ages	Amount above the ETP cap amount1	49%	ETP cap
Life benefit ETP – taxable component Payment is: a ‘golden handshake’ non-genuine redundancy payment severance pay a gratuity in lieu of notice for unused sick leave for unused rostered days off.	Under preservation age	Up to the relevant cap amount	32%	Smallest of ETP cap and whole-of-income cap2
	Preservation age or over	Up to the relevant cap amount	17%	Smallest of ETP cap and whole-of-income cap2
	All ages	Amount above the relevant cap amount	49%	Smallest of ETP cap and whole-of-income cap2
Death benefit ETP paid to non-dependants – taxable component	All ages	Up to the ETP cap amount	32%	ETP cap
		Amount above the ETP cap amount	49%	ETP cap
Death benefit ETP paid to dependants – taxable component	All ages	Up to the ETP cap amount	Nil	ETP cap
		Amount above the ETP cap amount	49%	ETP cap

1. The ETP cap amount for the 2014-15 income year is $185,000. The amount is indexed annually.

2. The whole-of-income cap amount for the 2014-15 income year and future years is $180,000. This amount is not indexed.

ETP tax tables withholding rates from 1 July 2013 to 30 June 2014

Income component derived by your employee in the income year	Age of person at the end of the income year that the payment is received	Component subject to PAYG withholding	Rate of withholding (including Medicare levy)	Cap to apply
Life benefit ETP – taxable component. Payment is because of: early retirement scheme genuine redundancy invalidity compensation for personal injury, unfair dismissal, harassment or discrimination.	Under preservation age	Up to the ETP cap Amount 1	31.5%	ETP cap
	Preservation age or over	Up to the ETP cap Amount 1	16.5%	ETP cap
	All ages	Amount above theETP cap amount 1	46.5%	ETP cap
life benefit ETP – taxable componentPayment is: a ‘golden handshake’ non-genuine redundancy payment severance pay gratuity in lieu of notice for unused sick leave for unused rostered days off.	Under preservation age	Up to the relevant cap amount	31.5%	Smallest of ETP cap and whole-of-income cap 2
	Preservation age orover	Up to the relevant cap amount	16.5%	Smallest of ETP cap and whole-of-income cap 2
	All ages	Amount above  the relevant cap amount	46.5%	Smallest of ETP cap and whole-of-income cap 2
Death benefit ETP paid to non-dependants. Taxable component 3	All ages	Up to the ETP cap amount	31.5%	ETP cap
		Amount above the ETP cap amount	46.5%	ETP cap
Death benefit ETP paid to dependants – taxable component 3	All ages	Up to the ETP cap amount	Nil	ETP cap
		Amount above theETP cap amount	46.5%	ETP cap
The ETP cap amount for the 2013–14 income year is $180,000. The amount is indexed annually. The whole-of-income cap amount for the 2013–14 income year and future years is $180,000. This amount is not indexed. A dependant includes both a child and spouse of the deceased. A child of the deceased includes all of the following: an adopted child, stepchild or ex-nuptial child 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).		Spouse of the deceased includes another person (whether the same sex or opposite sex) and all of the following: with whom the deceased was in a relationship that was registered under a law of a prescribed state or territory law who lived with the deceased on a genuine domestic basis in a relationship as a couple.   A dependant includes: any person with whom the deceased had an interdependency relationship a person who was a dependant of the deceased just before the latter died. before accepting that a person is financially dependent. An interdependency relationship includes a close personal relationship between two people who live together, where one or both provides for the financial and domestic support and personal care of the other. If an ETP will be paid to the trustee of a deceased estate, no amount should be withheld.