If an employee is dismissed from a company with a redundancy package that is seperate from their pension scheme,and the employee is dismissed on grounds that are not "favourable", can that dismissed employee put some of the redundacy monies received back into his/her pension scheme?
Put redundancy payment into pension?
- Thread starter R Flan
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Brendan Burgess
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You should only put money into a pension scheme if it is taxed at 41%. If your lump-sum is/was tax-free, then you don't need to read any further.
If some of the redundancy payment is going to be taxed at 41%, you could ask your employer to contribute it to the pension fund instead of paying it to you under PAYE.
If it has already been paid, and if you had income taxable at 42% last year, you can make an AVC or start a PRSA before the 31 October this year. The fact that it is coming from a redundancy would not matter. You could also do this with the proceeds of an SSIA, for example.
Brendan
If some of the redundancy payment is going to be taxed at 41%, you could ask your employer to contribute it to the pension fund instead of paying it to you under PAYE.
If it has already been paid, and if you had income taxable at 42% last year, you can make an AVC or start a PRSA before the 31 October this year. The fact that it is coming from a redundancy would not matter. You could also do this with the proceeds of an SSIA, for example.
Brendan
thanks brendan, appreciate it am only a trainee so was looking for a general idea as to what was needed/ required. therefore it wouldn't matter how the money is assertained once it is taxed at 41%. An SCSB calculation has to be done and the option giving the greater taxable lump sum will be used.