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Saying goodbye can be difficult

Employers in UK,

Sometimes, some business owners have to make hard decisions to say goodbye to their hard-working employees (or not-so-hardworking ones).

This is a challenging time for both parties and getting the termination payment right is very important.

This month I want to highlight the changes that the HMRC plans to put in place from April 2018 to ensure that when employees have to say goodbye to your business, their final payment is adequately taxed.

Termination payment is usually fully taxed when it is a reward for service performed, contractual, or expected from the employer. However, termination payment such as compensation for loss of office and redundancy payment also referred to as ex-gratia is only taxable to the extent that they exceed £30,000.

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