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Has a client been made redundant or been given the sack? FEMI OGUNSHAKIN warns of some of the factors that can result in a termination payment being subject to tax
KEY POINTS
- Is the payment earnings or damages?
- Why has the employment been terminated?
- The different types of notice.
- Has a redundancy taken place?
- The tax planning opportunities.
Unless you've just dropped in from outer space you — like me and thousands of other readers — will have noted the increasing number of press reports updating us on the impact that the 'credit crunch' is having on the current state of the economy.
In August alone there were numerous reports on slow economic growth the threat of a rise in inflation to close to 5% and the increase in the number of unemployed.
For many employers a reduction in head count will be a typical and in some cases an absolutely necessary response to the current economic climate.
The...
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