Termination Types

Termination types are set up in the Organisation | Common Reasons | Termination Reasons records and they determine how Exolvo taxes an ETP by applying special tax rates in the following situations:

• Bona-fide redundancy or approved early retirement

  Note: Compensation, harassment, discrimination, and unfair dismissal are taxed at the same rates as redundancies, but these termination reasons need to have Termination type = [Blank].

  For example, in the REDUNDANCY Termination Reasons record:

  

• Invalidity (permanent disability)
• Death – Payment to Dependant

  Pay the ETP to a dependant and the ETP is tax-free up to the ETP cap amount.

• Death – Payment to Non-Dependant

  Pay the ETP to a non-dependant.

• Death – Payment to Trustee

  Pay the ETP to the deceased's estate and the ETP has no tax withheld. Tax would be calculated and withheld by the trustee.

• (Blank)

  If the Termination Reasons | Termination type field is empty, then Exolvo applies the normal tax rate for the termination. For example, the RESIGNED and RETIREMENT records do not match any termination types so their Termination type fields are blank and the special tax rates do not apply.

Topic: 16649