Leaving job, final pay, which tax year does it fall into??

[Middlechild3]

If my agreed leaving date on taking Voluntary Redundancy is in March 2025 but my Redundancy pay plus pilon won't reach me until end of April, which tax year does that final payment including VR lump sum, count in, 2025 or 2026?

I suspect the answer will be it depends and relate exactly how the employer reports it.

Given the rapidity with which P60 forms are issued I'm not sure my employer's process would have it anywhere other than in April.

What is your contract end date? Worth asking your payroll department, as they may be able to do you a favour and pay PILON in April. If your redundancy is £30k or less, it won’t be subject to tax, so doesn’t matter when it is paid.

It will be whichever date payroll runs on/is on your payslip as that is the date reported in RTI. It also depends on whether you are paid a week/month in hand.

So if payroll is run monthly on the last day of the month for work up to and including that date then it will be 2025-2026.

If you are usually paid a month in hand so you are paid for all work undertaken in March on a date in April then it will be 2025-2026.

If it's paid in April, then it's filed in April with HMRC and will fall into the 25-26 tax year.

That I think is the key; what exactly the employer's RTI return says.

@Middlechild3 do you want it in this tax year or next?

Leaving date hopefully agreed later today. I've been told they won't have time to process things for March payroll on 18th for payment end of March. April payroll date 16th. I don't expect to see the money before the end of April but wondered if my actual end of employment date was in March does that money I'll get in April count as 2024_2025 earnings for my years tax or does it count as my 2025-2026 income. Before anyone asks no it's really not possible to get it processed for March payroll processing.

Month in arrears. I would have liked everything to have been sorted in this tax year. I was hoping it might be my leaving date that would count, not the date payroll processes it.

I was made redundant in Feb, my contract ended on 21st Feb on 28th Feb I got my pay for the days worked, redundancy, holiday pay and notice period pay in that pay check.
We had checked if we could have the notice period paid each month so we wouldn't get 14 months pay in 12 months but was told it had to be paid in the next pay period. I believe it would be in the next tax year for you as when you are paid rather when you earned it is what matters

It will count as 25-26 income then.

The same happened to dh. His employment ended 31st March but he got his final salary plus his pilon and severance pay in April payroll. He had wanted it in March because we could have applied for an in year assessment for ds's student finance and it would have taken us into the next category below.

Have you asked payroll if there is any flexibility for it to be moved to March payroll?

Absolutely no chance of that happening, payroll is tomorrow. HR dept couldn't have been more incompetent if they tried. I've known for over a month I'm going. (Most people going on either VR or CR

Thanks all, next tax year it is 🙂