Tax implications for rest of working year post receiving redundancy payout

themossinator

Hi, as per the subject I'm wondering if it's a good idea or not for me to seek another job this year?
I will get a voluntary severance payment in a few weeks, a colleague suggested that I might pay more tax at higher band this year if I get another job, due to my overall income for 2016 being high because of the extra income from redundancy payment

anyone got any experience of this?

thank you

mulbot

http://www.citizensinformation.ie/en/employment/retirement/income_tax_in_retirement/retirement_lump_sum_taxation.html

Have a read of this,it might help

colm_mcm

Redundancy shouldn't affect your PAYE as far as I know. You sometimes pay tax on the lump sum alright, but I don't think it has anything to do with tax free allowances etc.

themossinator

colm_mcm wrote: »

Redundancy shouldn't affect your PAYE as far as I know. You sometimes pay tax on the lump sum alright, but I don't think it has anything to do with tax free allowances etc.

Yeah Im hoping thats the case - thanks

Carawaystick

You'ld only be paying income tax on income. Would you prefer not to get any money instead of get to keep half of what you earn?

CIARAN_BOYLE

themossinator wrote: »

Hi, as per the subject I'm wondering if it's a good idea or not for me to seek another job this year?
I will get a voluntary severance payment in a few weeks, a colleague suggested that I might pay more tax at higher band this year if I get another job, due to my overall income for 2016 being high because of the extra income from redundancy payment

anyone got any experience of this?

thank you

First of all there's a tax free portion of redundancy so check whether your redundancy exceeds this. If it does you may have to pay more at the higher band depending on how your lump sum is taxed.

Often your taxed lump sum is taxed at the higher rate so it won't effect the rest of the years tax.