ESA affected by PILON?
okydoky
Posts: 267 Forumite
I am on extended sick leave and as my employers stopped paying me in June, I am claiming ESA at £72pw.
Meantime I have been invited to apply for VR which I have done and been accepted, and part of the settlement includes a payment for three months notice(Payment in Lieu of Notice),
So do I advise authorities and my ESA is stopped for this period or what happens? I consider it unlikely that I will be fit for work again in that period.
Also, my redundancy and pilon payments have been taxed at 40%+, and so far I have been unable to obtain an answer on this as my earnings in the tax year are only about £10K so vast majority of payment should have been taxed at 20%, taking into account first £30K of redundancy tax free?
Any advice gratefully received.
Meantime I have been invited to apply for VR which I have done and been accepted, and part of the settlement includes a payment for three months notice(Payment in Lieu of Notice),
So do I advise authorities and my ESA is stopped for this period or what happens? I consider it unlikely that I will be fit for work again in that period.
Also, my redundancy and pilon payments have been taxed at 40%+, and so far I have been unable to obtain an answer on this as my earnings in the tax year are only about £10K so vast majority of payment should have been taxed at 20%, taking into account first £30K of redundancy tax free?
Any advice gratefully received.
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I am on extended sick leave and as my employers stopped paying me in June, I am claiming ESA at £72pw.
Meantime I have been invited to apply for VR which I have done and been accepted, and part of the settlement includes a payment for three months notice(Payment in Lieu of Notice),
So do I advise authorities and my ESA is stopped for this period or what happens? I consider it unlikely that I will be fit for work again in that period.
Also, my redundancy and pilon payments have been taxed at 40%+, and so far I have been unable to obtain an answer on this as my earnings in the tax year are only about £10K so vast majority of payment should have been taxed at 20%, taking into account first £30K of redundancy tax free?
Any advice gratefully received.
Hi
The rules about PILON and ESA depend upon what sort of ESA you get. There are 2 types - contribution based and means tested. If you are getting the former then we think it is likely that there would be no effect on your ESA. if you are getting means tested ESA then it is likely it would be counted as you have started to get the EA before your job has ended. Suggest that you check with the DWP in any event.
On the tax issue suggest that you talk to the Inland Revenue about this :
HMRC Income Tax enquiries
0845 300 0627
Monday to Friday, 8am to 8pm
Saturday, 8am to 4pm“Official CAB Representative
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