Employment Termination Payments (ETP)

To facilitate an Employment Termination Payment for lump sum payments in foundU you will need to:
 
  1. Payout any remaining leave
  2. Make an ETP payment.
 For standard terminations follow this process.

Payout Unused Leave
Firstly, please make sure that any relevant unused leave is paid out to the employee.
 
1. In the quick menu, navigate to Payroll > Pay which will show the Draft Payslips
2. Find the relevant employees' paycycle and click the Actions button > Edit.
 Pay_out_leave_edit.png
3. Under Pay Items select Annual leave/ Holiday Leave Redeem. Then a Termination pop-up will display with the relevant type for reporting:
  • Include in Gross Payments
  • Lump Sum A Redundancy
  • Lump Sum A Termination

ETP_cash_out_entitelment.png

5. Click Calculate Totals, Preview PDF to check payslip and Update Paycycle. This will redirect you back the paycycle page for the next step.


ETP Creation

1. Back in Pay, click ETP to go the End Termination Payment page.

ETP_button.png

 2. Click Create New Payment.

create_new_payment.png

3. You can then select the Employee, Financial Year Ending and Payment Date.

4. Then click Add New Payment.

5. Select the Termination Type from the drop down e.g R for Redundancy 

6. Select if it is a Transition Termination Payment, or Part of a payment in an earlier income year.

7. Input the values for the termination including:

  • Non-Taxable Component
  • Taxable Component
  • PAYG Component.
  • Super Component
  • Add a label if required
  • Total Payment

ETP_payment.png

8. Once the correct values have been inputted you can then Preview the PDF (to view the payslip) 

ETP_Jane.png

9. If you are happy proceed, click Create Payment. 

10. A confirmation will appear allowing you to enter any comments for auditing purposes. Click Save Changes.

ETP_Confirmation.png

ETP_success.png

11.  This will create a pdf of the ETP and be available for the employee to download in their Employee Portal via Timesheets > Payslips.

ETP_employee.png

12. In Pay > Payslips You're now able to access the ABA History for this payment.

Additional information on how to tax Redundancy Payments that fall outside of the tax-free cap can be found at the following link: https://www.ato.gov.au/Business/Your-workers/In-detail/Taxation-of-termination-payments/?anchor=Redundancyandearlyretirement#Redundancyandearlyretirement

 
Please note: ETPs are not included in PAYG Summaries they are separate summaries altogether.
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