Redundancy and Tax Rebate Question

christabelle23

Hi,

My husband recently got made redundant at 59 after 39 years in same job. He came out with two years salary plus a bonus. He normally pays standard rate tax but because of this payout he paid approx £25,000 in tax !!!!!! He has a pension but is hoping to supplement it with a job if he can get one. However someone has told us that he could get a large amount of the tax back in April if he is not working at that time. His redundancy was at the end of August. Can anyone tell me if this is the case and can you guestimate at how much he would receive. He has the offer of a part time driving job to help a friend out, but he's unsure as whether to take it as it is only basic minimum wage. He has applied for loads of other jobs but so far not much else in the pipeline. He also receives job seekers allowance.
Thank you

getmore4less

he could have done a P50, but now claiming JSA it is too late.

if he gets a job some refund(pay no tax) comes that way, rest through a return.

to get an idea of the refund due add up all income for the year(inc JSA) and work out tax due. Compare to that paid so far.

Compo103

If I remember rightly, the first £30,000 of redundancy pay-off is tax free. Is that still the case?
Couldn't he have put the money above that into his pension fund, so deferring tax to when he might be a lower rate tax paying pensioner?

chrismac1

He should complete a P50. He'll get any tax due back in June 2014 or so if he submits the P50 in April. He may need to make a few calls as HMRC routinely slow pay these refunds.

harryhound

You need to post exact figures to get realistic advice.
You also have to tell us what your financial circumstances are (Mortgage paid off and a massive pension fund already?:D)
When (if ever) do you both plan to retire?

This might well be his (first &) last chance to put serious amounts of money into a SIPP and get back serious amounts of tax on it.
It is almost worth doing just to get the tax free lump sum in a few years time.

You don't explain his particular skills and thus his employability, as he is in the a dead spacek hole of having worked a long time for one employer and his future young boss would think him too young to retire but too old to change.
He might be able to work for his friend on a self employed basis if he can find another customer or two (parcel deliveries in the run up to Xmas ?)

As well as getting him out of the house and not able to start watching day time TV, he will be in contact with the rythm of business life, instantly available for any short term contract and the tax man/friend will be subsidising the cost of getting about to follow up job opportunities.