asked the Minister for Finance if he will make a particular effort to bring to the notice of employers that the statutory lump sum payable under the Redundancy Payments Acts is exempt from tax and that under the Finance Act, 1980 the first £6,000 of any additional payment by way of compensation for loss of employment over and above the statutory lump sum is also exempt from tax.
Written Answers . - Redundancy Payments .
357.
: The Employer's Guide to PAYE, which is issued by the Revenue Commissioners to all employers, shows, in paragraph 24, that payments under the Redundancy Payments Acts are "items not to be treated as pay" and, in paragraph 32, that, if employers are proposing to make other lump sum payments "on retirement or removal from employment", they should consult the Inspector of Taxes as to the amount of tax to deduct. Accordingly, while the most recent edition (March 1980) of the Guide does not show the increase from £3,000 to £6,000 in the exemption limit (or, in the case of first claims, in certain circumstances, to £10,000), employers will normally check the amount of any tax deduction with the Inspector of Taxes before such deduction is made.
A leaflet entitled "Income Tax: Payments on Retirement or Removal from Office or employment"—Leaflet No. 14—which is being amended to include changes made by the Finance Act 1980, will be available shortly at tax offices.
Additional copies of the "Employer's Guide to PAYE" are being placed in the Dáil Library.