Termination Payment

[amitr19]

Hi All - grateful for any advice.

Is voluntary severance payment the same as an ex-gratia payment?

An ex employee was paid £44,000 as termination payment. This was made up of :

- £9000 Statutory redundancy
- £8000 PILON (non-contractual)
- £27000 Voluntary Severance (calculated 3X of statutory redundancy as per organisation policy)

What's taxable?

Thanks
AR

[SteLacca]

What does he contract of employment say about them?

[amitr19]

contract is silent for all 3 of them.

[SteLacca]

Where the contract is silent, the starting point should be that only the excess over £30,000 of the total is taxable. (i.e. £14,000).

However, note that the rules are changing from April 2018.