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Leave and termination payments paid by an employer 108-07010100

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Leave and termination payment examples for customers impacted by an Income Maintenance Period (IMP)

Table 1

Item

Description

1

Coding leave payment on the IMP screen

Code the leave payment on the Income Maintenance Period (IMP) screen on the record of the customer who was paid the leave payment.

The system will assess the applicable IMP for affected customer(s) but will not include it in the income assessment of any non-IMP affected customer.

2

Termination payment and IMP affected payment

Alex receives Disability Support Pension and their partner Casey receives Age Pension.

Casey stops employment and receives 30 days Long Service Leave.

While the IMP provisions do not directly affect Casey, record the Long Service Leave on the IMP screen on their record. This will correctly assess Alex's IMP affected payment.

Casey's Long Service Leave is not considered income for Age Pension. The asset value and any deemed income from investments is assessed under the relevant Income Test and Assets Test.

3

Termination payment for ABSTUDY customer with a partner on an IMP affected payment

Jordan is getting ABSTUDY and their partner is getting JobSeeker Payment.

Jordan stops work and receives a payment for unused leave.

As they are on ABSTUDY, code the termination payment on the Other Income (OIN) screen over 52 weeks. The income is subject to the personal and partner income tests. No coding is needed on the partner's record.

4

Termination payment for a customer on an IMP affected payment with a partner on ABSTUDY

Riley is getting Parenting Payment Partnered and their partner is getting ABSTUDY.

Riley's employment stops and they receive a redundancy payment.

As Riley is getting an IMP affected payment, code the termination payment on the IMP screen. No coding is needed on the partner's record, and there will be no effect on ABSTUDY.


Purchased leave assessment example

Table 2

Item

Description

1

Purchased leave assessment

Bailey works as a refrigerator technician and is paid $60,000 a year. They have an overseas trip planned for the upcoming year but will not have enough annual leave available to cover the time off work.

Bailey purchases an additional 2 weeks of leave through an arrangement with their employer which reduces the salary by $2,307.69.

Their remaining salary of $57,692.31 will paid in even amounts of $2,218.94 each fortnight for the full year, including the period where they use the purchased leave.

Bailey’s payslips show a gross amount each fortnight of $2,307.69 which is then reduced by $88.75 to account for the leave purchased, leaving a remaining amount of $2,218.94.

How this is assessed:

  • Pays where no purchased leave is taken:
    • $2,218.94 is assessed as employment income
  • Pays where purchased leave is taken:
    • $2,218.94 is assessed as employment income