Redundancy - Payment In Lieu Of Notice (pilon)
20/03/2022 26/03/2022 05/12/2021 11/12/2021 19/06/2021 02/10/2021 27/03/2022 02/04/2022 12/12/2021 18/12/2021 26/06/2021 09/10/2021 03/04/2022 09/04/2022 19/12/2021 25/12/2021 03/07/2021 16/10/2021 10/04/2022 16/04/2022 26/12/2021 01/01/2022 10/07/2021 23/10/2021 17/04/2022 23/04/2022 02/01/2022 08/01/2022 17/07/2021 30/10/2021 24/04/2022 30/04/2022 09/01/2022 15/01/2022 24/07/2021 06/11/2021 01/05/2022 07/05/2022 16/01/2022 22/01/2022 31/07/2021 13/11/2021 08/05/2022 14/05/2022 23/01/2022 29/01/2022 07/08/2021 20/11/2021 15/05/2022 21/05/2022 30/01/2022 05/02/2022 14/08/2021 27/11/2021 COPYRIGHT © 2021 THE CHARTERED INSTITUTE OF PAYROLL PROFESSIONALS REDUNDANCY - PAYMENT IN LIEU OF NOTICE (PILON) A payment in lieu of notice (PILON) is due where an employer terminates the employee’s contract without giving due notice as required by either the contract or the employee’s statutory minimum rights. The employee becomes entitled to receive a payment in lieu of that which would have been due had the full period of notice been served. PILON can be compensation for breach of the contractual right to notice. If the contract or any other company documentation is silent on the option to make a payment in lieu of notice then such payments may not be subject to NICs or tax but see http://www.hmrc.gov.uk/manuals/ eimanual/EIM12977.htm for HMRC’s latest position on PILONs and CWG2 ‘Employer Further Guide to PAYE & NICs’. Where the option of a PILON is, or is deemed to be a contractual entitlement then the payment will attract Income Tax and NICs liability. (See also - Termination Payments in PART2). Contractual entitlement may be established by either: • reference to written conditions of employment, or other documentation or • the employer’s custom and practice in previous terminations. No printing, copying or reproduction permitted. From 6th April 2018 all PILON payments are treated as earnings for Income Tax and NICs irrespective of the circumstances. This ends all speculation concerning contractual and non- contractual treatment. Employers are required to work out the Post Employment Notice Payment (PENP) using a formula laid down by HMRC. Any PENP is subject to Income Tax and NICs in the normal manner and any sum outside this can be covered by the £30,000 exemption. REDUNDANCY - STATUTORY PAYMENTS Statutory Redundancy Pay was introduced in 1965 and is a lump sum payment payable when an employee’s job is lost as a result of redundancy. The legislative source is now the Employment
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