I may have confused things by calling it pay in lieu of notice or PILON. Perhaps best to call it statutory notice pay. This is paid by the government insolvency service when your employer cannot pay because of insolvency. See here..
http://www.insolvency.gov.uk/pdfs/gu...remployees.pdf
Section 20 says "If you get another job during all or part of this notice period, we have to deduct any wages you earn." and "We have to deduct any state benefits you are entitled to even if you have not claimed that benefit. We also deduct a notional amount for tax, as you would have paid this as tax had you received the notice payment as wages."
So it seems clear that if I earn any wages, or claim JSA, this will be deducted, but I wondered if I could not pay myself for these 12 weeks then there would be no wages to deduct.
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Previously on "Pay in lieu of notice"
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Originally posted by private123 View PostForgive me if this is at all inappropriate for this forum, but I think it could be classified as both "Accounting" and "Legal".
I will shortly be made redundant as the company I work for is in administration. When I am made redundant I will be entitled to claim 12 weeks pay in lieu of notice from the government, capped at £430 per week, minus Job Seekers Allowance (regardless of whether I claim JSA).
However, if I immediately start a "job" then any earnings will be offset againsr this, and I will effectivly lose this £4k or so. (Why anyone would bust a gut to start looking for a job straight away under these circumstances is beyond me - strange government rule).
Anyway, I hope to start a LTD and start a contract immediately after being made redundant. Is there any legal way I could avoid losing this money. For example if I did not pay myself any salary or dividends for the first 12 weeks ?
Even if this is possible, I wonder where this would leave me with NI as there would be a 12 week gap in my contriubutions. Not sure if that would cause me any problems further down the line.
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Originally posted by private123 View PostI will be entitled to claim 12 weeks pay in lieu of notice from the government, capped at £430 per week, minus Job Seekers Allowance (regardless of whether I claim JSA).
However, if I immediately start a "job" then any earnings will be offset againsr this, and I will effectivly lose this £4k or so. (Why anyone would bust a gut to start looking for a job straight away under these circumstances is beyond me - strange government rule).
Presumably this is in place to help people when it takes them time to find a job after the shock of redundancy.
So it's up to you to decide, use (abuse?!) the system that is in place, or just get a "job".
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Originally posted by private123 View PostAnyway, I hope to start a LTD and start a contract immediately after being made redundant. Is there any legal way I could avoid losing this money. For example if I did not pay myself any salary or dividends for the first 12 weeks ?
Even if this is possible, I wonder where this would leave me with NI as there would be a 12 week gap in my contriubutions. Not sure if that would cause me any problems further down the line.
Alan
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Pay in lieu of notice
Forgive me if this is at all inappropriate for this forum, but I think it could be classified as both "Accounting" and "Legal".
I will shortly be made redundant as the company I work for is in administration. When I am made redundant I will be entitled to claim 12 weeks pay in lieu of notice from the government, capped at £430 per week, minus Job Seekers Allowance (regardless of whether I claim JSA).
However, if I immediately start a "job" then any earnings will be offset againsr this, and I will effectivly lose this £4k or so. (Why anyone would bust a gut to start looking for a job straight away under these circumstances is beyond me - strange government rule).
Anyway, I hope to start a LTD and start a contract immediately after being made redundant. Is there any legal way I could avoid losing this money. For example if I did not pay myself any salary or dividends for the first 12 weeks ?
Even if this is possible, I wonder where this would leave me with NI as there would be a 12 week gap in my contriubutions. Not sure if that would cause me any problems further down the line.Tags: None
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