Payments in lieu of notice

redvalley

Good evening. I am looking for help regarding payments in lieu of notice. I am due to be made redundant in February and will be receiving three months PILON at the end of February which I know is taxable at my normal rate of 40%. My issue is that I will then be retiring and will not be a 40% tax payer from then onwards. As I will be paid it all in February for March, April and May I wondered how the tax will be calculated as April and May should be at 20%. Should I ask my employer to pay them separately or ask HMRC what to do?


Thanks

Masomnia

If it all goes through in Feb then it'll count towards your income for this tax year. Maybe as part of the negotiations ask if they can spread the payments out, or even pay it all in the next tax year, I don't think there's any reason why they can't unless someone else knows better.

Enjoy your retirement