What is an ETP?
An ETP (employment termination payment) is a payment you receive as a result of ending your employment. These payments should be shown on a PAYG payment summary - employment termination payment (NAT 70868).
You must also report most ETPs on your tax return, including
- death benefit ETPs - paid to you for someone that died
- foreign ETPs - received from overseas employment, but reportable only if exempt from that country’s income tax
- late termination payments - received more than 12 months after ceasing employment
- transitional termination payments - certain ETPs you were entitled to on 9 May 2006
ETPs you don’t need to report on your tax return include
- foreign termination payments that were not exempt from that country’s income tax
- directed termination payments paid by your employer to a complying superannuation fund or to purchase a superannuation annuity.
- ETPs received as the trustee of a deceased estate - they must be reported on the tax return of that estate.