Vol. 407 No. 2
18 Mr. R. Bruton asked the Minister for Finance when the current level of tax-free allowances which apply in the case of lump sums paid in connection with the termination of employment, were last increased; the current level of allowance if they had been indexed over the intervening period.
As the Deputy will be aware, statutory redundancy payments under the Redundancy Payments Acts are exempt from tax. In addition, the first £6,000 of any other lump sum payment made by an employer to an employee in connection with termination of employment is also tax-free. This may be increased by up to £4,000 in certain circumstances. These figures were fixed in 1980. They would now be approximately £13,800 and £9,200 respectively if they had been increased in line with the consumer price index over the intervening period. The cost of increasing them to those levels is estimated at about £5.5 million a year.
