Reported 12 months ago
Severance and retirement payments are often confused by companies and employees, leading to tax filing errors and potential audits. A recent case involving a company and an employee highlighted the importance of correctly categorizing such payments. In this case, the tax authority ruled that a severance payment was considered retirement income, based on the purpose of the payment relating to the employee leaving the company. Understanding the purpose of such payments is crucial to avoid tax-related issues.
Source: YAHOO