Redundancy and Tax

Darkside2003

Hi,

Hopefully someone can help me.

I was made redundant in March 2010 and had 45,000 + redundancy pay which sounds great.

However if the redundancy is over 30,000 you have to pay tax on the rest of the amount.

Now in 2010 companies were only told to apply the basic rate of tax but the tax office is expected to ask for the high rate of tax.

So what happens if this doesnt happen ? Or at least doesnt happen until nearly two years later ?

I have been sent a tax calculation form that says I owe the outstanding amount for 2010-2011 e.g. £3,000.

Trouble is I was not aware of this I never ever do my own tax return as everything is done through PAYE. As I was going through redundancy I expected everything to be done for me through PAYE. I wasnt told the company would apply basic rate only.

Now its a year on and I have already spent the money :eek: - so what now ? Please help ?

getmore4less

Anything over £30k gets added to the income for the year and tax appropriately.

What was your total for the year including the excess over £30K.

Don't forget any investment income(interest/dividends) that add to the total

Might be worth looking at doing a tax return to get your tax across all income for that year correct.

March 10 would be tax year 09/10 not 10/11

Did you try to get the redundancy moved to April, it might have saved tax unless you got a better paying job.

BoGoF

Basically not a lot you can do....should have got some advice before you spent the money. Make a payment arrangement is all you can do.

ermine

I have already spent the money

Crikey. What on earth on? Hope it was needs and not wants....