And now seen this:
http://www.masonbullock.co.uk/tax-on-se ... greements/
Tax on a settlement agreement payment when you are not leaving
When you are not leaving the job, or are carrying on with a different job with the same employer, the rules are slightly different from when you’re dismissed. There’s no £30,000 limit and most payments apart from compensation payments will be taxable as earnings.
If your settlement agreement is for a dispute concerning discrimination, or on account of an accident at work, then it will not be taxable, unless some of it is to make up for lost earnings, in which case that part will be taxable.
I'm not a lawyer but I'd expect that payments of legal fees you've incurred would be a compensation payment.
Your solicitor is probably the best place to go to get more information.