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TAXguide 06/19: Termination payments

Technical release

Published: 12 Apr 2019 Update History

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A new regime for taxing termination payments was introduced from 6 April 2018. TAXguide 06/19 sets out a number of questions in relation to the changes, with answers provided by HMRC.

Questions asked include

  • Do you do calculate the post employment notice pay (PENP) if the employee is summarily dismissed with no notice?
  • What view does HMRC take as to the type of allowances that must be added to basic pay?
  • Are employer pension contributions part of basic pay?
  • In a fixed term contract that is terminated early, is the notice period the number of weeks from the early termination date until the when the contact would have ended?

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TAXguide 06/19

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