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| *Ostroff, Fair and Company>>>United Kingdom Taxes |
Do you pay tax on redundancy payments? |
Based in UK. Been offered a lump sum on top of the standard package. Do I pay tax on the lump sum or the standard package? The tax limit for redundancy payments was 拢30000. After that the lump sum becomes taxable. This limit may have increased in the latest budget, so check on the HMRC website to make sure. Source(s): www.hmrc.gov.uk I got made redundant last year, bliss it was!! 4 months living like a King! anyway, erm from what I remember, the lump sum was tax free and the package was taxed... they did initially take all pension contributions from the package also (it was 6 months pay so 6 months worth of pension) but this got refunded about 8 months later due to them noticing their screw up! If you take it, enjoy it.... think of what you've never had the chance to do and do it, dont be boring and save, go wild and I'll have a beer please!! lol I would imagine the ordinary rate of Tax would have to be paid.Having reached the point for unearned income the balance would be taxed at 40%. You could of course make a sizeable donation to the National Trust a worthy organisation Tax Free. |
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