Employment taxes update

Key points:

  •   Employees will be unaffected
  •   Employers will not be impressed with this change and may see it as a barrier to paying off those employees they want to terminate.

Having been involved in the consultation forums surrounding how to tackle the “fat cat” pay offs it comes as no surprise something is changing to deter employers from paying substantial amounts of money in termination payments.

There was debate around whether or not to reduce the £30k limit and make it subject to Income Tax and National Insurance Contributions, but so much was said around the individuals who don’t have any choice in the matter if their employer chooses to terminate the contract.

So to the positives for this move; the individual will see no change and not pay Income Tax up to £30,000 and no National Insurance Contributions on any payments

From April 2018,  the employer and therefore the business will have to pay employers’ National Insurance on any termination payments made that are above £30,000.

Get in touch

To find out more about how we can help you or your business, call us on 0808 144 5575 and speak to a member of our team. Alternatively use our contact form to send us a message or arrange a callback.

CALL 0808 144 5575

or

Contact Us

All content © 2015 Armstrong Watson. All Rights Reserved. Website by Simon Pighills.

Armstrong Watson LLP is a limited liability partnership registered in England and Wales, number OC415608. The registered office is 15 Victoria Place, Carlisle, CA1 1EW where a list of members is kept. Armstrong Watson Accountants, Business & Financial Advisers is a trading style of Armstrong Watson LLP. Armstrong Watson LLP is regulated by the Institute of Chartered Accountants in England and Wales for a range of investment business activities.

Armstrong Watson Audit Limited is registered to carry on audit work in the UK and Ireland by the Institute of Chartered Accountants in England and Wales. Registered as a limited company in England and Wales No. 8800970. Registered office: 15 Victoria Place, Carlisle, CA1 1EW

Armstrong Watson Financial Planning Limited is authorised and regulated by the Financial Conduct Authority. Firm reference number 542122. Registered as a limited company in England and Wales No. 7208672. Armstrong Watson Financial Planning & Wealth Management is a trading name of Armstrong Watson Financial Planning Limited. Registered Office: 15 Victoria Place, Carlisle, CA1 1EW