Termination payments include:
- unused annual, long-service or sick leave
- deferred or accrued wages
- commissions
- bonuses
- employment termination payments (including death benefit payments).
As long as you pay the amount as a consequence of terminating a person’s employment or directorship, it will be taxable, regardless of:
- who receives it
- when it is paid.
See Public Ruling PTA004—Termination payments for more information.