tax on redundancy pay

Newbiesw

I think you should speak to your Payroll rather than a Forum in this case as only they have the answer to a couple of different scenarios which I am only guessing:
It looks like you are leaving on 31/3 and you will have been paid to 31/3.
Any payment relating to redundancy cannot be paid before you leave, so 1/4 is the earliest date of any redundancy relating payment.
If your next pay day is 30/4, then they may be paying you a redundancy cheque dated 1/4 on your last day (31/3) so you have left the building and all outstanding monies paid to you on your final day BUT the gross value of that manually raised cheque still has to be passed through the payroll and can only either be done in April (20%) or a manual adjust to the 09/10 period (40%).
The only reason why I could think of an employer wanting it to go through 09/10 is either their budget (your year end is March and they don't want £thousand going into next years budget) or just keeping it looking tidy (you left in March so the March figures should be manually adjusted).
This is the main reason why you should speak to your Payroll as it may not make a lot of difference to them what they do, not thinking about the effect it has on you and you may be able to bring it to their attention (whilst you still have time) and they will be happy to accomodate you rather than waiting to see what happens and it becomes a 40% "fait accomplit"

Newbiesw

getmore4less

.Also check with the tax office, see what they say.
this looks like a relevent doc

http://charterconsultation.hmrc.gov.uk/manuals/eimanual/EIM13110.htm

Imples the payment is deemed to have been recieved on 1april(termination on the 31mar) even if paid later.

Benjamin10_2

Thanks all. I will beg and plead with pay branch! Advice much appreciated.:o

Newbiesw

Thanks for another option Jimmo.
Tried your link but I'm afraid these Government websites have a very sleep-inducing effect on me so didn't make it all the way through to the end !
Are we saying different rules apply here because of the nature of the payment ?
i.e Payments are usually taxed at the rate when they are paid, not at the rate they are due/earned.
The payment was ceratinly due before year end (1st April) but OP is not paid until April 30 (this is why I queried the unusual pay date of Apr 1),
Had that payment been lined up to go through the Payroll, it would have been paid in the new year?

Newbiesw

Newbiesw

Scrap my last Post, just seen your reply to Cepheus which arrived after mine !!!!

Great, so if I get a £200,000 bonus in April (which I earned in March ) I can apply this same principal and only pay 40 not 50 % tax ? :j

No, I didn't think so, talk about this Government wanting it all ways just to shaft us as much as they can and for as much as they can.

Newbiesw

bondy01

This thread sounds familiar. I took VR (with many colleagues) at the end of 2001. I had so much work on that I wasn't allowed to leave until the end of march 2002. I was then asked to stay until the end of april but initially said no. However , after thinking it over I realized I would be £7k better off by staying an extra month because of the tax year so that is what I did.