Forum Discussion

3 months ago

Final pay - including payment of 2 weeks in lieu of notice period

Hi, I need to do a final pay for 2 employees who have ceased employment with us, we are paying out their 2 weeks notice instead of them working this time out. If I add '80 hours' into their final pa...

MYOB Business

SupportNoteGuy

MYOB Staff

3 months ago

Hi Ann31 - thanks for your question.

Payments in lieu of notice are classified by the ATO as an employment termination payment (ETP). These are taxed differently to other final payments and should be paid in a separate pay to any other final payments, like unused leave.

Take a look at this help topic that steps you through how to process an ETP.

Once you've paid the ETP, you can then process their other final payments.

I hope this helps!

Adrian

Bullswool
Trusted User
3 months ago
SupportNoteGuyThis was probably an NZ payroll question.
- Earl_HD
  MYOB Moderator
  3 months ago
  Hi Bullswool and Ann31,
  
  In addition to SupportNoteGuy's suggestion, you can add the extra 2 weeks as a pay item to include it in the gross calculation, along with the current 8% in the final pay. You may also need to start a new pay run. For more information, I recommend visiting this help page. Setting up pay items / payroll categories.
  
  Regards,
  Earl