Lump sum payments in arrears can be entered in various locations in the individual tax return. These locations include payment summaries for both Individual non-business and Foreign employment, superannuation income streams, foreign pensions, Australian non-superannuation annuities, and foreign employment income that is not reported on a payment summary.
In order to provide an estimate of the lump sum payment in arrears tax offset, APS Tax requires the taxable income figure for each of the years to which a lump sum payment relates.
Navigate to Additional Information
Select Lump Sum Payments in Arrears Offset
Enter the Taxable income each year where the lump sum arrears amount has been received.
If the taxable income for the accrual year is not entered then it is assumed to be $0 and the APS warning AW10079 is displayed.
Note: The APS Tax estimate of the lump sum payment in arrears tax offset is dependent on the information for prior years entered by the user. If this doesn't match the ATO's records, there will be a difference in the tax offset calculated by the ATO.
There are limitations to the estimate of the lump sum payment in arrears tax offset and these are set out in the limitations field at the top of the item. As such, the offset calculated by APS Tax is an editable field so that the user can override the calculation if any of these limitations apply or for any other reason where the user considers the APS calculation to be incorrect.