Is redundancy payments taxable?

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Do I have to pay tax for redundancy payments that my ex-employer paid me? If yes, do you know what are the applicable rates and how the tax is calculated?

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score 0 · Answer 1 · 2013-04-16T23:11:55+00:00

It depends on which country you are referring to. In the US, redundancy payments or Severance Payments as they are called are fully taxable as income. There is no tax free amount (100% taxable).

In the UK, there is limit (the statutory limit) and everything below that limit is not taxable. The limit is £30k and everything above this threshold is taxed as income but anything below that is not taxed at all.