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A brief history of my time in tax

Income taxImage by alancleaver_2000 via Flickr

I am not going to tell you how long I have been working in tax, but suffice it to say I have a lot of experience. Things have changed so much that it seems to me that the public in general still entertains ideas about tax which are long outdated if indeed they were ever correct in the first place.Once upon a time in the UK tax system, people did not get … Continue Reading

What are golden hellos?

Having talked about golden handshakes I ought to mention the “golden hello”, which is a payment made to a future director or employee. It is just possible (only just!)that a payment received from someone other than the new employer – a third party – could be construed as non-taxable. Where a lump sum payment is made to a prospective new employee, it will be taxed as advance pay for future services unless it represents compensation for some right or asset given up on taking up the employment. An example going back to the 1950s was where an … Continue Reading

What are golden handshakes?

Golden handshakes are payments to an individual upon termination of employment and may also be known as lump sum payments.There are cases where such payments are not taxed at all, which are those post-death when an employee has died in service, and in some cases payments due to disability may qualify for exemption. Those are outside the norm.For the most part termination payments are taxable under special rules. The first £30,000 of a leaving payment will be exempt from tax if it is an ex-gratia payment and therefore non-contractual. One may have to make the case … Continue Reading