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Redundancy
The Fiji Revenue and Customs Authority (FRCA) have stated that the taxable portion of a redundancy payment is not subject to the Social Responsibility Tax (SRT). Use allowances with Tax override type = “Redundancy or Retirement” for the taxable portion of redundancy payments only.
Note: When you add a transaction for an allowance with Tax override type = “Redundancy or Retirement”, the Tax override tab | Override type value is now "%" instead of "Xtra Emolument Calc".
You need to use two redundancy allowances: one for the non-taxable portion and the other for the taxable portion.
We recommend using the following settings for the non-taxable allowance:
Field |
Value |
Type |
A.Allowance |
Paying |
Yes |
Taxable |
No |
We recommend using the following settings for the taxable allowance:
Field |
Value |
Type |
A.Allowance |
Paying |
Yes |
Taxable |
Yes |
Tax override |
Yes |
Tax override rate |
15 |
Tax override type |
Redundancy or Retirement |
Retirement
FRCA have indicated that retirement payments can be completely tax-free, partially tax-free or completely taxable. If the payment is taxable, it is subject to SRT.
You need to use two retirement allowances: one for the non-taxable portion and the other for the taxable portion.
We recommend using the following settings for the non-taxable allowance:
Field |
Value |
Type |
A.Allowance |
Paying |
Yes |
Taxable |
No |
We recommend using the following settings for the taxable allowance:
Field |
Value |
Type |
A.Allowance |
Paying |
Yes |
Taxable |
Yes |
Tax override |
Yes |
Tax override rate |
[Blank] or the applicable rate |
Tax override type |
[Blank] |
Important: Do not use "Redundancy or Retirement" because it will not calculate tax correctly for Fiji. |
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Topic: 40741
