Budget Rumours

The Dagda

Has anyone heard any rumours about the upcoming budget?

Our accountant told us today that there's rumours that the relief on redundancy payments will be halved.
Does anyone here know if this is announced on budget day will it be effective immediately, or from Jan 1st?

smeharg

Maybe you should re-post...in German

Sorry, couldn't resist.

It's a hard one to call. If something like that was brought in the Government would want it to be effective as soon as possible to limit planning possibilities.

On the other hand it may be too complex to bring in as a budget resolution. I'm not sure if the powers that allow them to bring in changes on budget night are limited in anyway.

Gloomtastic!

I read yesterday somewhere it would affect profitable companies letting staff go so if you're not making profit you might get away with it.

JD Dublin

As I understand it they are talking about the refund that companies get when they pay employees redundancy.

The situation is that companies just tick a box now to declare that they cant afford to pay redundancy, and then the state automatically pays the company a percentage of the redundancy.

Obviously small comapnies who are broke availed of this clause, but so did Dell when it let people go. I am sure Dell could well aford to take the hit on this sort of thing, so why should the taxpayer fund their redundancy payments?

That is what is affected as far as I know. At least thats the rumoured proposal. Employees should not be affected in any way.

The Dagda

JD Dublin wrote: »

As I understand it they are talking about the refund that companies get when they pay employees redundancy.

The situation is that companies just tick a box now to declare that they cant afford to pay redundancy, and then the state automatically pays the company a percentage of the redundancy.

Obviously small comapnies who are broke availed of this clause, but so did Dell when it let people go. I am sure Dell could well aford to take the hit on this sort of thing, so why should the taxpayer fund their redundancy payments?

That is what is affected as far as I know. At least thats the rumoured proposal. Employees should not be affected in any way.

I'm sorry, but you clearly don't understand it.

Every company is entitled to 60% relief on statutory redundancy payments. This is paid out of the social insurance fund, which the employer has been contributing to on behalf of the employee.

There's no box to tick for a company to declare unability to pay.
If a company is insolvent the employee can apply for the payment themselves.

paulac

Every company is entitled to the 60% statutory relief. If an employer is unable to pay, then they can sign the rp50 and submit a letter from their accountant stating that at present they are unable to pay and that they will accept liability for paying the 40% when they are in a position to do so.

So its not a 'tick the box' but it can be done and the employer doesn't have to be insolvent