Making staff redundant
Tax when making staff redundant
If you make staff redundant, you may give them a ‘termination payment’. This could include:
- statutory redundancy pay
- holiday pay
- unpaid wages
- company benefits, for example bonuses
You must deduct tax and National Insurance from some payments.
You do not deduct tax on the first £30,000 of statutory redundancy pay.
What you’ll deduct tax and National Insurance on depends on what’s included in the employee’s termination payment.