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PENP Tax calculation on redundancy
westy666
Posts: 1 Newbie
There has been a new tax law brought in this year called PENP (Payments in lieu of notice).
I've read a few tax blogs and read the HMRC guidance and it's still not clear.
Basically I'm on a 6 month notice period due to redundancy, I've agreed with my employer I can leave after 3. I won't be getting paid for the last 3 months of my notice period.
I may have got this completely wrong but the calculation seems to say I'll be getting taxed on the last 3 months even though I'm not being paid. And they'd take it from the redundancy payment. Which seems wrong, but wound't put it past HMRC to do.
Called HMRC and they weren't much help, first advisory I spoke to didn't even know what PENP was.
Anyone shed any light on this ? i'm due to leave in 3 weeks and just found out and if I'm not sure I'll have to stay another 3 months as it's quite a chunk of tax they'll be taking.
I've read a few tax blogs and read the HMRC guidance and it's still not clear.
Basically I'm on a 6 month notice period due to redundancy, I've agreed with my employer I can leave after 3. I won't be getting paid for the last 3 months of my notice period.
I may have got this completely wrong but the calculation seems to say I'll be getting taxed on the last 3 months even though I'm not being paid. And they'd take it from the redundancy payment. Which seems wrong, but wound't put it past HMRC to do.
Called HMRC and they weren't much help, first advisory I spoke to didn't even know what PENP was.
Anyone shed any light on this ? i'm due to leave in 3 weeks and just found out and if I'm not sure I'll have to stay another 3 months as it's quite a chunk of tax they'll be taking.
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