How does the system calculate PAYG on a non-ETP termination pay?
PAYG on unused leave is calculated using the ATO’s marginal rate calculation method. In the pay run, when you click on the “?” icon in the employee’s PAYG field, a context panel will be displayed detailing the method of how PAYG was calculated for the non-ETP components of the termination pay.
Clicking the blue “?” icon on the right of each step will provide an explanation of how each amount has been calculated.
Refer to this article for a detailed explanation of the breakdown to determine the applicable PAYG amount on the non-ETP components of an employee's termination pay.
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