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Currently an extra statutory concession provides that an employee's legal fees in connection with the termination of employment are tax-free if they are paid by the employer to the employee's lawyer under the terms of a settlement agreement, or are paid pursuant to a court or tribunal order
Our December ebulletin noted the HMRC's intention to change PAYE regulations and require employers from 6 April 2011 to apply the usual basic, higher and additional tax rates (without taking personal allowances into account) to post-P45 payments
Compensation for discrimination (other than for financial loss arising from termination) is tax-free, even where it is considerably more than a tribunal would award for injury to feelings
