The difference is if it is paid in lieu it doesn't have to be worked for. Most people who are on employed are on four weeks notice, some three months so if I was offered 12 months pay for no work, I'd take it and take the tax hit, unless there was a clause which precluded me from working in the same business for 12 months.
One final point. If you don't take another job before the end of the current tax year or even if you do, you may be entitled to a repayment of some of the tax you have paid. After 5 April 2016, call the tax office and ask them to review your tax position for 2015/16. Alternatively, if you don't intend to work before the end of the tax year, you can apply for an in-year tax repayment by completing a form P50 here.