salary

[condriac]

is salary in lieu of notice taxable ? being a compensatary
payment for "loss of office"

[Memore]

pay in lieu of notice is taxabe

[BuckyKat]

pay in lieu is taxable if your company has a contractual agreement to offer it however it can also be tax free, you can apply directly to the tax office for relief or ask your company to do so on your behalf

[buildersmate]

Pay in lieu of notice is taxable. Compensation for loss of office (which is often paid by companies in situations of redundancy) is not taxable up to a figure which used to be �30k (may have changed). If one is on a long notice period period you may find that part of the severance payment is in lieu of notice, the rest is non-taxable.

[themas]

1. If you are given notice and told not to work it, but are paid for the notice period this is "gardening leave" and the pay is taxable. The employment termination date would then be the end of the notice period.

2. If you are dismissed without notice (i.e. the termination date is the date you are told) then you should receive compensation for breach of contract - the breach being the failure to give you notice. This compensation is the amount of gross pay you would have received had you been given notice. Tax and national insurance should not be deducted because it is not pay - it is compensation.

3. The only qualification to 2 is - as stated by BuckyKat - if the employment contract allows for payment in lieu of notice. If that is the case, then tax & NI do apply.

4. If the dismissal is for gross misconduct it can be immediate with no entitlement to notice pay.