Settlements

cossie1990

Hi,

I have a series of questions regarding my wife’s current situation that I just need clarity on. Basically this is the situation and then my questions will follow. 

She has resigned from her current employer, she is a teacher and a settlement was agreed. Her termination date was 29th Feb. However the settlement to date still hasn’t been processed. She’s been paid via payroll in March and April. 

Today she received her P45 with the last date of employment as 29th Feb and it states she hasn’t been paid anything this tax year. 

1) the fact that this settlement has taken so long to be processed and she hasn’t been able to look for other work or claim benefits has lost her nearly 2 months pay, does she have a case?

2) She has been paid, taxed, ni’d, pensioned in April but her P45 says that she hasn’t, not sure how this works whether it will just be backdated to Feb?

3) Should her settlement be pensionable? We were under the impression that it would be subject to tax and NI but not sure about pension. She’s been paying it for the last 2 months as she’s been on the payroll. 

4) Now that she has her P45 can she look for other work or claim
benefits given the current situation even though we think there is still a settlement balance to be paid? will the benefits be backdated?


thanking you all in advance!

Undervalued

1) I am not sure why she has not been able to look for other work? You don't need a P45 to do that. Had she found work she could have filled in a new starter's form (used to be called a P46). It is not uncommon for a P45 to be late or even not be supplied at all!

3) Generally a settlement is tax free up to £30K. Anything else such as payment in lieu of notice would be taxable.

Presumably she must know what settlement she agreed to and was advised by a solicitor (or specially trained Trades Union rep).

Mountain_Biker

I had a settlement agreement last year.  The agreement stated very clearly what I was being paid and when it would be paid.  My trade union rep. reviewed it before passing it on to a solicitor.  What did the agreement say about pension payments, the termination date and when the payment would be made?  Why was she paid in March and April if she left on 29 February?  
Was the settlement agreement to do with redundancy or of the "termination by mutual agreement" type?

Dox

cossie1990 said:

Hi,

I have a series of questions regarding my wife’s current situation that I just need clarity on. Basically this is the situation and then my questions will follow. 

She has resigned from her current employer, she is a teacher and a settlement was agreed. Her termination date was 29th Feb. However the settlement to date still hasn’t been processed. She’s been paid via payroll in March and April. 

Today she received her P45 with the last date of employment as 29th Feb and it states she hasn’t been paid anything this tax year. 

1) the fact that this settlement has taken so long to be processed and she hasn’t been able to look for other work or claim benefits has lost her nearly 2 months pay, does she have a case?

2) She has been paid, taxed, ni’d, pensioned in April but her P45 says that she hasn’t, not sure how this works whether it will just be backdated to Feb?

3) Should her settlement be pensionable? We were under the impression that it would be subject to tax and NI but not sure about pension. She’s been paying it for the last 2 months as she’s been on the payroll. 

4) Now that she has her P45 can she look for other work or claim
benefits given the current situation even though we think there is still a settlement balance to be paid? will the benefits be backdated?


thanking you all in advance!

1. A case for what? What was stopping her looking for work? As for claiming benefits, the amount due under the settlement would probably have extinguished anything she might otherwise have been able to claim, although without seeing the details that can only be a tentative answer.
2. It's the P45 info which HRMC should be working on.
3. What does the settlement say?
4. She can look for work and investigate what benefits might be payable. With so little information, it's impossible to be sure. Try https://www.gov.uk/browse/benefits