TAXguide 06/19: Termination payments
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?