{"id":"F2018L00431","name":"Income Tax Employment Termination Payments (12 month rule) Determination 2018","slug":"income-tax-employment-termination-payments-12-month-rule-determination-2018","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":99980,"registerId":"commonwealth-F2018L00431-current","compilationNumber":null,"startDate":"2026-04-02","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1. Name of Instrument","sectionType":"part","heading":"1. Name of Instrument","content":"## 1. Name of Instrument\n\nThis determination is the Income Tax Employment Termination Payments (12 month rule) Determination 2018.","sortOrder":0},{"sectionNumber":"2. Commencement","sectionType":"part","heading":"2. Commencement","content":"## 2. Commencement\n\nThis instrument is taken to have commenced on the day after it is registered on the Federal Register of Legislation.","sortOrder":1},{"sectionNumber":"3. Application","sectionType":"part","heading":"3. Application","content":"## 3. Application\n\nThis determination applies to a payment received, after the date that this instrument is registered on the Federal Register of Legislation, by a person if the payment is received:\n\n(a) either\n\ni) in consequence of the termination of that person’s employment; or\n\nii) after another person’s death, in consequence of the termination of that other person’s employment; and\n\n(b) more than 12 months after that termination; and\n\n(c) is not a payment under section 82-135 of the Income Tax Assessment Act 1997.\n\nIn this determination, such a payment is called a late termination payment.","sortOrder":2},{"sectionNumber":"4. Repeal of previous determination","sectionType":"part","heading":"4. Repeal of previous determination","content":"## 4. Repeal of previous determination\n\nThis determination replaces Employment Termination Payments (12 month rule) Determination 2007 F2007L04372 (the previous determination) registered on 16 November 2007. The previous determination is repealed on commencement of this determination.","sortOrder":3},{"sectionNumber":"5. Determination","sectionType":"part","heading":"5. Determination","content":"## 5. Determination\n\nThis determination is made in accordance with subsection 82-130(7) of the Income Tax Assessment Act 1997 (ITAA 1997).\n\nParagraph 82-130(1)(b) of the ITAA 1997 does not apply to a late termination payment if the payment is received more than 12 months after the termination of a person’s employment because:\n\n    (a) legal action was commenced within 12 months of the termination of employment, of which the subject is either or both:\n    i) the person’s entitlement to the payment;\n    ii) the amount of the person’s entitlement; or\n    (b) the payment was made by a liquidator, receiver or trustee in bankruptcy of an entity that is otherwise liable to make the payment, where that liquidator, receiver or trustee is appointed no later than 12 months after the termination of employment.","sortOrder":4},{"sectionNumber":"6. Definitions","sectionType":"part","heading":"6. Definitions","content":"## 6. Definitions\n\nIn this Determination:\n\n‘liquidator’ means a person who becomes a liquidator of a company and who has given the Commissioner of Taxation notice of that fact under subsection 260-45(2) of Schedule 1 to the Taxation Administration Act 1953.\n\n‘receiver’ means a person who, in the capacity of receiver, or of receiver and manager, takes possession of a company’s assets for the company’s debenture holders and who has given the Commissioner of Taxation notice of that fact under subsection 260-75(2) of Schedule 1 to the Taxation Administration Act 1953.\n\n‘trustee in bankruptcy’ means a person who, in the capacity of ‘the trustee’ as defined in section 5 of the Bankruptcy Act 1966, notifies the Commissioner of Taxation of the bankruptcy.","sortOrder":5}],"analysis":{"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"flash_summary":{"complexity_score":3,"scope_assessment":{"changed":false,"description":"Clause 4 repeals and replaces the 2007 determination, but the operative rule (that paragraph 82-130(1)(b) does not apply to late termination payments where delay arose from legal action begun within 12 months or payment by a liquidator/receiver/trustee appointed within 12 months) is restated in clause 5. The instrument limits application to payments received after registration (Commencement cl.2; Application cl.3). No substantive broadening or narrowing of scope is apparent from the text provided."},"complexity_factors":["Narrow, rule‑based exceptions — only two listed pathways (legal action timing; insolvency appointment) make the instrument easy to apply (see Determination, cl.5).","Dependence on precise timing facts: whether legal action was \"commenced\" within 12 months or a liquidator/receiver/trustee was \"appointed no later than 12 months\" (Application cl.3(b); Determination cl.5(a)-(b)).","Cross‑statutory references requiring checks in other statutes: paragraph 82-130(1)(b) of the ITAA 1997 is the external provision affected (Determination cl.5); definitions link to Taxation Administration Act Schedule 1 notices and Bankruptcy Act s.5 (Definitions cl.6).","Evidentiary and administrative burden on payers/payees to prove commencement dates or insolvency appointment and notice to the Commissioner (Definitions cl.6; Determination cl.5(b)).","Commencement and transitional application limited to payments received after registration, which simplifies scope but requires attention to timing (Commencement cl.2; Application cl.3).","Replacement of prior instrument may require stakeholders to confirm no substantive change in application (Repeal cl.4)."],"plain_english_summary":"This instrument sets when an Employment Termination Payment received more than 12 months after employment ends can still receive the standard tax treatment. It treats such \"late termination payments\" as qualifying only where the delay was caused by legal proceedings started within 12 months of termination, or where a liquidator, receiver or trustee (appointed within 12 months) makes the payment. It applies to payments received after registration and replaces the 2007 determination."},"kimi_summary":{"content_quality":"ok","complexity_score":2,"scope_assessment":{"changed":false,"description":"The instrument maintains its original narrow purpose: prescribing exceptions to the 12-month rule for employment termination payments. It replaces the 2007 determination without expanding beyond the two established exception categories (legal action and insolvency)."},"complexity_factors":["Short instrument: only 6 sections covering 2 specific exceptions","Minimal defined terms: only 3 technical definitions (liquidator, receiver, trustee in bankruptcy), all cross-referencing other Acts","Single conditional test: the 12-month rule exception applies only if specific triggering events occurred within the 12-month window","No nested exceptions or complex computational rules","Clear legislative hook: explicitly made under subsection 82-130(7) of the ITAA 1997 with straightforward operation"],"plain_english_summary":"This law preserves the favourable tax treatment of an employment termination payment (ETP) even if paid more than 12 months after employment ends, in two cases: where the worker started legal action about entitlement or amount within 12 months, or where the employer entered insolvency with a liquidator/receiver/trustee appointed within 12 months.  \n\nIt affects departing workers, employers, insolvency practitioners and the ATO, preventing unfair higher taxation of delayed payments beyond the worker’s control."}},"importantCases":[],"_links":{"self":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018","history":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018/history","analysis":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018/analysis","conflicts":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018/conflicts","importantCases":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018/important-cases","documents":"/api/acts/income-tax-employment-termination-payments-12-month-rule-determination-2018/documents"}}