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Employment Termination Payment (ETP)

Summary

How do I generate a employment termination payment?

Detailed Description

Employment termination payments (ETP): a payment given to an employee, or another person, as a result of the termination of the employee's job. ETP's are taxed at different rates depending on your employee's age and length of employment. Reasons for termination can include age retirement, resignation, dismissal, termination due to death or redundancy. For further information click on the following ATO link: https://www.ato.gov.au/forms/payg-payment-summary---employment-termination-payment-from-1-july-2012/

To set up an ETP in Cashbook please do the following process:

Go to Payroll

  • Setup Lists 
  • Employment Termination Payment
  • Add

 On the next screen, Add a name of the payment 

  • Select an ETP Category from the drop-down 
    • NOTE: You will need to ask your accountant which category is most applicable to your situation.
  • Click OK to proceed.

The next task is to set up your employees pay to include the termination payment.

  • Under Payroll, access your employee 
  • Add Pay 
  • Select the tick box "Has Employment Termination Payments?"
    • This will bring up a new tab called Employment Termination Payments 

Add your employees pay as per normal

Click on the Employment Termination Payment tab, choose the payment from the dropdown and fill in the details as per your accountants' advice.

Finally, complete the pay and submission to the ATO.

 

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