EGPAUS: Preservation Age Calculation For ETP Tax Is Not Complying With Legislation (Doc ID 2035401.1)

Last updated on MARCH 09, 2017

Applies to:

PeopleSoft Enterprise HCM Global Payroll Australia - Version 9.1 to 9.2 [Release 9]
Information in this document applies to any platform.

Symptoms

ACTUAL BEHAVIOR
-------------------------------
There is an issue with the calculation of the Preservation Age for ETP tax.


For example: Employee is 54 years and 5 months old on Termination date:17/07/201
The ETP was taxed at 17 %



EXPECTED BEHAVIOR
--------------------------------------

As per ATO legislation, the Preservation Age depends of the year of birth:

Before 1/7/1960                    55
1/7/1960 - 30/6/1961            56
1/7/1961 - 30/6/1962            57
1/7/1962 - 30/6/1963            58
1/7/1963 - 30/6/1964            59
After 30/6/1964                    60

For the tested scenario, the employee was born in Jan 1961.
As per ATO legislation, the Preservation age for this birth date would be 56.

Since the employee is under the Preservation age, the ETP should be taxed at 32%



BUSINESS IMPACT
-----------------------------
Some employees are being undertaxed

Cause

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