PILON - Is this a tax deductable expense?

Posted by Anonymous PM | on Tue, 09/03/2010 - 11:09 455 2 comments | report

Have seen loads of posts on here as to whether a PILON is taxable or not.

If the PILON is taxable is it deductable as an expense for the Company?

Also if tax free on employee, is this deductable as an expense?

I was under the impression that it was deductable only on cessation of trade, can someone please clarify?

Thanks

Comments

accountant78 | Tue, 09/03/2010 - 12:12 | Permalink

The payment is tax deductible regardless of whether or not it is taxable on the employee.

Any payment to or in relation to an emplyee is always deductible.

Anonymous | Tue, 09/03/2010 - 12:14 | Permalink

Is the expenditure incurred wholly and exclusively for the purposes of the trade?

It is a simple as that.