Redundancy

The Fiji Revenue and Customs Authority (FRCA) have stated that the taxable portion of a redundancy payment is not subject to the Social Responsibility Tax (SRT) or Environment and Climate Adaptation Levy (ECAL). Use allowances with Tax override type = “Redundancy or Retirement” for the taxable portion of redundancy payments only.

Note: When you add a transaction for an allowance with Tax override type = “Redundancy or Retirement”, the Tax override tab | Override type value is now "%" instead of "Xtra Emolument Calc".

You need to use two redundancy allowances: one for the non-taxable portion and the other for the taxable portion.

We recommend using the following settings for the non-taxable allowance:

• Type = A.Allowance
• Paying = Yes
• Taxable = No

We recommend using the following settings for the taxable allowance:

• Type = A.Allowance
• Paying = Yes
• Taxable = Yes
• Tax override = Yes
• Tax override rate = 15
• Tax override type = Redundancy or Retirement

Retirement

FRCA have indicated that retirement payments can be completely tax-free, partially tax-free or completely taxable. If the payment is taxable, it is subject to SRT and ECAL.

You need to use two retirement allowances: one for the non-taxable portion and the other for the taxable portion.

We recommend using the following settings for the non-taxable allowance:

• Type = A.Allowance
• Paying = Yes
• Taxable = No

We recommend using the following settings for the taxable allowance:

• Type = A.Allowance
• Paying = Yes
• Taxable = Yes
• Tax override = Yes
• Tax override rate = [Blank] or the applicable rate
• Tax override type = [Blank]

  Important: Do not use "Redundancy or Retirement" because it will not calculate tax correctly for Fiji.