Working for sister company after Redundancy

I was made redundant on March 31st. I have been offered a 7 week tempory post with a sister company (not with the same Trading name) to start on Monday, its not doing the same job, not in the same building. Could this make me liable for Tax on my Redundancy package?

Hi John

When you say you were made redundant on 31 March, was that actually your last day of service or were you served notice on that day? If the former, then I don't think you have anything to worry about. In fact, even if you have been offered this post during your notice period, I don't think you will lose your redundancy payment as it does not sound like it is a suitable alternative to redundancy (as it is only a temporary post).

You would probably be better advised to talk to a tax specialist about any tax implications. However, my understanding is that any statutory redundancy payment to which you are entitled is tax-free. Had your employer offered you a suitable alternative post before your last day of service, which was to commence no later than 4 weeks after your last day of service, your redundancy payment would be forfeited entirely (so I guess if they let you keep it you would become liable fror tax as it would no longer be a statutory redundancy payment - it would be some sort of ex gratia payment instead). That does not apply here as stated above, as you have not been offered a suitable alternative and as I believe the offer was made after your last day of service.

I hope that helps.

Pete