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Ben Jones
Ben Jones, UK Lawyer
Category: Employment Law
Satisfied Customers: 47351
Experience:  Qualified Employment Solicitor - Please start your question with 'For Ben Jones'
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I've been told I'm very likely to be made redundant

Customer Question

Hi,
I've been told I'm very likely to be made redundant soon as the company I work for wants to focus on hiring more sales people. My contract under the section 'Termination' says "Your employment can be terminated under any of the following circumstances: " ...one other circumstances is:
"c. Without cause: after the end of the probationary period your employment may be terminated by either party giving to the other not less than three months’ notice. The company reserve the right to make a payment in lieu of notice to you calculated by reference to basic salary only."
What I want to know is, can I push for a compromise agreement and therefore pay no tax? From what I've read the PILON statement included in my contract could mean that I would get taxed.
Thanks,
Michael
Submitted: 1 year ago.
Category: Employment Law
Expert:  Ben Jones replied 1 year ago.
Hello, my name is***** am a solicitor on this site and it is my pleasure to assist you with your question today. How long have you worked there for?
Customer: replied 1 year ago.
4 months.Been told that I'm likely to go either November or end of year.
Expert:  Ben Jones replied 1 year ago.
Because the notice period clause is in your contract, it is a contractual benefit and would be treated as any other income under contract so would be taxable. There is nothing stopping you and the employer from agreeing a settlement agreement but under law they would have to treat the notice part as a taxable income, just as it would have been had you been given notice and left to work through your notcie period. Leaving under a settlement agreement does not mean you do not pay tax, you could still have tax liabilities even if you leave under a settlement agreement. In this case you would still be liable for tax regardless of whether you leave under a settlement agreement or not.
I trust this has answered your query. I would be grateful if you could please take a second to leave a positive rating (selecting 3, 4 or 5 starts at the top of the page). If for any reason you are unhappy with my response or if you need me to clarify anything before you go - please get back to me on here and I will assist further as best as I can. Thank you
Expert:  Ben Jones replied 1 year ago.
Hello, I see you have read my response to your query. Please let me know if this has answered your original question or if you need me to clarify anything else for you in relation to this? If your query has been dealt with please take a second to leave a positive rating by selecting 3, 4 or 5 starts from the top of the page. If you need further help please get back to me on here and I will assist as best as I can. Thank you.

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