Redundant end of 02-2010, can I have redundancy money after 05-04-2010?

HardCoreProgrammer

My company made my last position redundant at the end of November. I managed to find another position before that date.

I am now on a 3 month trial period at my new position. Unfortunately, for various reasons I have decided not to continue with it and will leave at the end of the 3 month trial period, which is just before the end of February.

I am on 8 weeks notice period, but I will be paid in lieu of notice at the end of the trial period (confirmed with HR).

The company usually pays out the redundancy payment within 2 weeks of termination. As I do not expect to be earning money in the 2010-2011 tax year, I think it may be financially advantageous to have the redundancy payment (notice period + redundancy payment at 2 weeks per year of service + unused holiday allowance) paid to me after the end of the 2009-2010 tax year.

Am I correct to think that I will save on tax if I receive the redundancy payment after 05-04-2010, and is there a way to bring about this legally?

Thank you.

dmg24

You can ask your employer, but I think it very unlikely as they will need to process your P45 before the year end.

Emmzi

no, not legally. your thinking is right but asking = tax evasion. you have 'earned' the cash in this tax year.

first 30k not taxable anyway tho, as redundancy. if you are getting much over that you are doing well.

HardCoreProgrammer

Thank you very much for your replies.

Emmzi, I understand that my redundancy payment (2 weeks per year of service) is not taxable - but the unused holiday allowance and pay in lieu of notice are. No, the payment is way below 30K so I am not doing as well as you think.

I was asking because I am being paid in lieu of 8 weeks notice. If I had to work the notice period, then that would take me beyond the 2009-2010 tax year.

The redundancy payment is only made after I sign the compromise agreement.

Maybe I can cheekily ask if I can work out my notice period instead of being paid in lieu? They need people after all.

Emmzi

Good luck, but I think it highly unlikely!

really you are talking about the tax on (work ends end of Feb, March is this tax year) 4 weeks work and maybe 2 weeks holiday?

In my head you'd be better taking the hit and having as much paid time as possible to focus on your cv and meeting agencies face to face. It's not worth giving this up for a grand or two.

If there's a debate to be had it's whether you can have some outplacement help as part of your agreement, and what reference they are putting in for you. This would be far more important than money.