Measures that increase the cut-off age for concessional tax treatment of termination payments because of an employee’s genuine redundancy or a qualifying early retirement scheme received Royal Assent on 28 Oct 2019. The measures feature in Treasury Laws Amendment (2019 Measures No. 2) Act 2019, which align the cut-off age for individuals to receive tax concessions with the current Age Pension age.
Prior to this new law, individuals who were made redundant or took early retirement were allowed to ask their employer to refund the excess tax withheld on their payments and the employer received a refund from the Australian Taxation Office. However, employers didn’t have to comply with refund requests because the correct tax was paid at the time and in those cases, employees were credited when they submitted their income tax returns.