Top Slicing Relief

Tax and Redundancy doesn't stop once you get your payment from your employer - but this is good news rather than bad.  In the year following the redundancy, you will need to check for Top Slicing Relief.

The key consideration in giving Top Slicing Relief is that the individual should not suffer a tax rate on their Lump Sum in excess of the average rate of tax paid on all their income for the previous 3 years. i.e. if the lump sum is being taxed at the higher rate (41% in 2009) and the average tax rate applicable for the preceding 3 years was 35%, then a taxable lump sum of €16,800 would give :

Top-Slicing Relief of: €16,800 x (41%-35%) = €1,008.

Top Slicing Relief does not affect your initial tax calculations, but reduces the final figure, in this case by €1,008.

Check your Taxes and Claim Refunds

If you have been made Redundant and paid taxes, then you must get your taxes checked or you could miss out on Refunds.

Get in touch with Red Oak Tax Refunds now for a Tax assessment, including your redundancy.

When to Claim

Top Slicing Relief cannot be claimed until after the end of the tax year in which the redundancy payment was received. However, you will need to make sure that your previous 3 years taxes are correct before this can be reviewed - you can work on this straight away!

For more information

• Use our Redundancy Calculator
• Read our blog posts on redundancy