voluntary redundancy? taxed????

fairplay4u

My company,emmmm bank wink wink!! have offered a gd voluntary redundancy package, i put my name forward but i know upto £30k isn't taxed so as most payouts are capped mine won't be over that.....if i'm lucky enough to get it, think they have been flooded with ppl wanting it though.

If you cleared your debts with your dough then i think thats fine (as long as you keep proof ) if worst came to worst you can get jsa or IS until you get another job, depending on the household income of course. Although any savings over £6k will decrease the amount of jsa or IS you get.

Good luck, but think carefully cause £30k is a gd salary to be on,

Take care.

Debt_Free_Chick

There could be two elements to the total payment - contractual pay in lieu of notice (PILON) and compensation for the loss of job.

PILON is simply advance payment of your normal salary so it will be taxed in the usual way.

Compensation is "damages" and the first £30k is free of tax, under HMRC rules.

LittleVoice

Debt_Free_Chick wrote: »

There could be two elements to the total payment - contractual pay in lieu of notice (PILON) and compensation for the loss of job.

PILON is simply advance payment of your normal salary so it will be taxed in the usual way.

Compensation is "damages" and the first £30k is free of tax, under HMRC rules.

PILON is not always contractual. If not contractual it is damages and not taxable.

The £30K limit is re redundancy pay.

maninthestreet

LittleVoice wrote: »

PILON is not always contractual. If not contractual it is damages and not taxable.

The £30K limit is re redundancy pay.

How can PILON be 'damages' ????

Debt_Free_Chick

LittleVoice wrote: »

PILON is not always contractual.

Sorry for not being clear what I meant was - if your PILON is contractual and that's part of the payment, then it will be taxed.

maninthestreet wrote: »

How can PILON be 'damages' ????

"Damages" is a legal remedy for breach of contract