Tax implications - Starting a new job while on annual leave with current employe

huskie69

Hi All,

I was recently offered a new job and my current employer requires 3 months notice.  By the end of my notice period (up to 25th December), I will have accrued 11 days annual leave.  My intention is to take this annual leave right at the end of my employment, so technically the 8th December will be my final day "in the office".

I'd then like to immediatelty start with my new employer on the 9th December (in the interview, I wasn't sure how long my notice period was but I reckoned it was no more than 2 months - so they're a little disappointed I can't start as soon as expected).

I'm not sure my current employer will be that bothered about me working for another organisation for the last few weeks with them - I'll be on annual leave anyway.   However, I'm concerned about taxation implications as I'll be earning over double my current salary for those 11 days in December.   How can I handle this? 

68ComebackSpecial

Have you actually asked your current employer whether you can take your holiday then? It might be your intention but they would be within their rights to refuse it.

huskie69

Yes, they know I'll be taking all the remaining leave towards the end of my notice period

LittleVoice

huskie69 said:

. . .  However, I'm concerned about taxation implications as I'll be earning over double my current salary for those 11 days in December.   How can I handle this?  

It will sort itself out.  When you begin work with the new employer they should give you a New Starter form and on that you indicate that you have worked elsewhere during the current tax year.  They will then apply the standard tax code on a Month 1 basis.  Your current employer will also be applying whatever your current tax code is but on a cumulative basis as normal.

When you get your P45 from your current employer you pass the relevant parts to the new one and they will use that and the information about the tax they themselves have deducted to get things sorted through normal route with HMRC.  It will mean you will need to pay extra tax the following month because you will have received two lots of tax-free earnings for the overlap month but this will sort itself out within the tax year.

You don't have to do anything else - just fill in the New Starter form and later hand over the P45.

Sandtree

You know that they can cancel your holiday by giving you 11 days notice?

Have you spoken to your current employer about ending early? An employee thats working their notice is rarely the best performer and, depending on your industry, December may be a quiet month so could be reasonable and let you go two weeks early or such.

getmore4less

Sandtree said:

You know that they can cancel your holiday by giving you 11 days notice?

or what ever the contractual arrangements for holiday are which could be no notice required.

huskie69

Sandtree said:

Have you spoken to your current employer about ending early? An employee thats working their notice is rarely the best performer and, depending on your industry, December may be a quiet month so could be reasonable and let you go two weeks early or such.

Yep, already addressed this with them - suggested an early exit, but they need me to work the entire notice period due to projects being already fully committed.    I don't think they can force me to take leave, therefore, I'm bolting it on at the end.  I also doubt they'd want to pay me for it so I think I'm ok in that respect.

Sandtree

getmore4less said:

Sandtree said:

You know that they can cancel your holiday by giving you 11 days notice?

or what ever the contractual arrangements for holiday are which could be no notice required.

My understanding, from the ACAS website, was that the minimum notice required was equal to the number of days holiday being taken... though its been a while since I looked so rules may have changed

getmore4less

Sandtree said:

getmore4less said:

Sandtree said:

You know that they can cancel your holiday by giving you 11 days notice?

or what ever the contractual arrangements for holiday are which could be no notice required.

My understanding, from the ACAS website, was that the minimum notice required was equal to the number of days holiday being taken... though its been a while since I looked so rules may have changed

The rules have not change since the legislation was introduced back in 1998
https://www.legislation.gov.uk/uksi/1998/1833/regulation/15/made

ACAS site is wrong if that is what it says ,  contract terms can override the statutory notice.

Sandtree

getmore4less said:

Sandtree said:

getmore4less said:

Sandtree said:

You know that they can cancel your holiday by giving you 11 days notice?

or what ever the contractual arrangements for holiday are which could be no notice required.

My understanding, from the ACAS website, was that the minimum notice required was equal to the number of days holiday being taken... though its been a while since I looked so rules may have changed

The rules have not change since the legislation was introduced back in 1998
https://www.legislation.gov.uk/uksi/1998/1833/regulation/15/made

ACAS site is wrong if that is what it says ,  contract terms can override the statutory notice.

More likely either my memory is wrong or I never read it properly in the first place