redundancy tax

richierich007

hi all
i am being made redundant soon and a package im happy with

its over the 30k mark so here goes,

my redundancy is 29800 and a bonus of 8k

will the 8k be paid at 20% or 40% and also will the tax im paying go on to this year tax ie any earnings this year the 8k will show up or have i lost that tax from my earnings on this year tax

i was thinking if its gone for good as in if i take a lower paid job this year i be paying very little tax
or am i better off asking my co if i can put say 2k in my dc pension, might aswel lump it on there than the taxman

hope ive made sense

slapmatt

Redundancy pay up to £30,000 is tax free, so you're £29,000 should be unaffected.

I'm not sure what you mean by "bonus", but this sounds like normal income. Depending on your salary, if you are a standard rate taxpayer it will be taxed at 20%, plus National Insurance of 12%. Don't forget, you have an £11,850 annual personal allowance, so you will benefit from this.

It will be taxed in the year it is paid to you, so 2018/19.

xylophone

It would seem that the bonus is taxable income?

You will also have some salary for the current tax year?

It could be possible to make a contribution to your pension and receive tax relief.

https://www.gov.uk/tax-on-your-private-pension/pension-tax-relief