Payments - Lump Sum E
Lump sum E represents the amount for back payment of remuneration that accrued, or was payable:
- more than 12 months before the date of payment (Pay/Update Date) and
- greater than or equal to the lump sum E threshold amount ($1,200).
This means that an oversight or delay led to the payment not being paid in an earlier financial year (underpayment) and is only now being paid in the current financial year.
If and/or when a payment meets both criteria, payable more than 12 months prior and greater or equal $1,200 per ABN/Branch No./BMS Id or Software ID/Payroll Id, then the payment is no longer to be reported as it would ordinarily be, but instead: as Payment Type – Lump Sum Type-E. This re-allocation of Payment Types may occur at each pay event where the conditions are met or at finalisation
The lump sum E payment amounts to be reported per financial year in which the accrued payment was payable. This will eliminate the need for employers to issue employees with lump sum E letters at the end of financial year, as this data will be available on the ATO Online Income Statement but will NOT be pre-filled into the IITR.
Yes, if the Lump Sum E payment is considered as ordinary time earnings payment, if not such as overtime, then super does not apply.
Yes, the sacrifice is considered as Voluntary which means it has to be reported under the Employee's Salary Sacrifice and the Employer Reportable Super Contribution (RESC).
Lump Sum E payments are taxed as per NAT 3348 Tax table for back payments, commissions, bonuses and similar payments - Method B(ii)
Adding a Lump Sum E Payment
- Access the Other Payments from the application menu
- Click
- The lump sum E window appears
- Select the required employee
- Select the financial year that the payment belongs to
- Enter the taxable gross
- Select Yes for ordinary time earnings payments, No for non-ordianry time earnings payments
- Enter the payment date
- Click Save
If you set the OTE Payment to Yes, the super entitlement will be added.