Recovering tax on redundancy payment

Recovering tax on redundancy payment

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I have a client who will receive approx £60k redundancy payment on 30th April 2012.  He has been told that the taxable element will be taxed on a "0T Month 1" basis.  The client is likely to go into employment and be paid under PAYE from 1st May 2012, but with very low PAYE earnings through to 5th April 2013.  What is the best way to recover the tax overpaid as quickly as possible please?  Does he have to wait until 6th April 2013 and then submit a tax return, or is there a quicker way of doing things?

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Euan's picture
By Euan MacLennan
10th Feb 2012 13:18

Why not ...

... ask the employer to issue the P45 only after the taxable redundancy payment has been made, so that it is taxed on his normal PAYE code?  The P45 can then be used in his new employment to generate tax refunds monthly throughout the tax year.

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