working out redundancy pay!

[eggyhead]

I'm not sure how to work out redundancy pay!

 

What if the top line pay has changed?

Is it worked out on the weeks pay you last got? By this I mean, I was paid 450 a week 12 months ago, Then this went to 400 a week, and then 330 a week 12 weeks ago! What will it be worked out on?

 

I will get 11 weeks redundancy for my 11 years working. And my contract says another 11 weeks PILON.

 

Finally, what will be taxed, and at what rate?

[Ell-enn]

Statutory redundancy pay is not taxed - you can work out how much you will get here: Ready Reckoner for calculating the number of weeks' pay due - BERR

 

As for your PILON that will be based on your average wage for the last 12 weeks and is taxable, as is any holiday pay due to you.

[eggyhead]

Okay thanks.

 

will my Statutory redundancy pay be a 12 week average wage also?

[Ell-enn]

When you enter your weekly wage in the Berr redundancy calculator it would be the average of the last 12 weeks. The maximum redundancy pay is capped at £350 per week.

[patdavies]

As for your PILON that will be based on your average wage for the last 12 weeks and is taxable,

 

Only if it states so in your contract. Otherwise it is classed as damages for breach of contract and is therefore not taxable.

The maximum redundancy pay is capped at £350 per week.

No, it's not. £350/week is the maximum statutory rate. A company can pay any rate they like above the minimum. If a redundancy payment exceeds £30,000 then income tax does apply.

[Ell-enn]

When you enter your weekly wage in the Berr redundancy calculator it would be the average of the last 12 weeks. The maximum redundancy pay is capped at £350 per week.

 

I was referring to the statutory redundancy calculator on the BERR website!

[eggyhead]

Thanks for the help.My employer has given me a compromise agreement. I need to work out if it's worth taking.

[Ell-enn]

Is your employer paying for your solicitor to look over the compromise agreement?

[eggyhead]

there is a clause, but it says.The employer shall pay to the advisor a contribution of £250.00 (inclusive of VAT) towards the employees legal expenses relating exclusively to the completion of this agreement and upon production of an appropriate VAT invoice addressed to the employee for payment by the employer.I have issues with my employer and don't want to sign!

[Ell-enn]

Talk over the issues with your solicitor when you consult them over the compromise agreement.

[eggyhead]

Do you not think that the clause says, that if I don't sign (completion of) that I will get the bill?

[Ell-enn]

There's nothing to say you can't question the terms of the compromise agreement before finally signing it.

[Capricorn1601]

Only if it states so in your contract. Otherwise it is classed as damages for breach of contract and is therefore not taxable.

No, it's not. £350/week is the maximum statutory rate. A company can pay any rate they like above the minimum. If a redundancy payment exceeds £30,000 then income tax does apply.

 

 

Sorry to butt in Pat can you explain how we can prove that we can claim Pilon tax free, My OH has just been made redundant and doesnt have a formal contract so hence no clause. His tax alone is around £4k so we could do with claiming this back but not sure how to start.

 

 

Caps