Paul Lewis takes on the unlikely role of
agony uncle to answer questions about money at work!
Q. I’ve heard there will be redundancies in my department. Do I have to take redundancy and how much will I get?
A – Being made redundant is a form of dismissal. It happens when your employer needs fewer people. If your employer decides your job is no longer needed they can make you redundant.
Check your contract - some employers offer one month’s pay for every year worked. If your redundancy is voluntary, you may get even more. Up to £30,000 is free of tax. At the other end, there is a minimum ‘statutory redundancy payment’ laid down by law. To get that in full you have 64 or younger and have worked for the same employer for at least two years. The amount depends on how many complete years you've worked for the company and how much you earn. You cannot get more than £8,100.
If your boss fails to cough up on the payment or goes bust you can get help and advice from the Redundancy Payments Service – call 0500 848489 or the DTI Redundancy helpline – 0845 145 0004.
Your employer has to be fair in choosing the people who are made redundant. If you suspect that you have been chosen because of trade union membership, parental responsibilities, refusing to work long hours, or demanding the national minimum wage then you may have a case for unlawful dismissal, which you must make within three months. You should get help and advice as soon as possible. Contact your union or your local Citizens Advice Bureau for advice. (contact details on page X.) For more information look on the DTI website www.dti.gov.uk.
Q. I’m just about to start a new job and have been offered the option of a company car. I’ve heard I may have to pay extra tax if I take up the offer – is this right?
A: Yes. Employees are taxed heavily if they have a company car. Unless you do a lot of miles it may be better to buy a car yourself and charge your employer for the mileage you do. You can be paid up to 40p a mile for up to 10,000 miles a year without paying any tax or national insurance on it, and 25p a mile after that. More at www.inlandrevenue.gov.uk leaflet IR124 and IR 172
Q. Is there a legal minimum I have to be paid?
A: Yes. It is called the National Minimum Wage. From 1 October 2004 you must be paid £4.85 an hour if you are aged 22 or more; £4.10 an hour if you are aged 18 to 21; and £3 an hour if you are 16 or 17 and have left school. This rate does not apply to apprentices. If you are self-employed or are paid per item – for example fruit picking – then the minimum wage is worked out so you normally earn that much. If you get tips in your job they are counted as part of your minimum wage. If you think your pay is below the minimum call 0845 6000 678.
Q: I have to belong to a professional society as part of my work. Are there any tax concessions on the cost?
A: he annual fee and the cost of professional journals can be counted as an expense and you should be able to reclaim the tax paid on that amount. There are thousands of professional organisations and societies that are approved. Trade union fees are not included. Also if you have to wear a uniform or use tools that you are responsible for, then you can claim a small annual amount off your tax. See www.inlandrevenue.gov.uk/list3 and www.inlandrevenue.gov.uk/leaflets/c13.htm
Spring
2005
e-mail Paul Lewis on paul@paullewis.co.uk