Selling holiday back to company

I think your argument will be found to be unconvincing.

In effect you'll be working 15 days overtime. This will be paid, and the pay will be taxed. Case closed. :-(

Your subject line had me thinking you were trying to sell a package holiday back to Butlin's. :-)

It's taxable income, for Income Tax purposes. The only time it might not be is as part of a redundancy settlement (in which case, you'd need to check with a tax lawyer to be certain). Whether or not it's liable to National Insurance as well I'm not so certain, but I suspect so.

Why not call the Inland Revenue, and get the answer from the horse's mouth? You don't have to identify yourself, and you'll get a canonical answer. The Self Assessment Helpline is 0845 9000 444.

Jon

Bitstring , from the wonderful person alfi said

Been there, done that (from both sides). It will not surprise you to know that you'll just get taxed on 15 days of extra pay (c.f. overtime); Taxed, National Insuranced, and anything else the government can think of. Of course you could just tell the company not to bother to pay you for it, and then, in an unconnected gesture of goodwill, they could stick some huge sum into your pension fund .. but that wouldn't help you until you are least 50 years old.

Of course you'll be taxed on it, just like if you took unpaid leave you'd save paying tax on the pay you'd lose.

However the company is legally obliged to give you 20 days leave under the Working Time Directive. You can opt out of this, but you could negotiate, say, getting paid time and a half for any leave you work. This should pretty much make up for the pay being taxed.

Yeah, the accounts manager has checked it out and it is taxable and national insurancable and student loanable plus it tips me over into the 40% tax band which means I will lose more of this years bonus too.

Is your employer paying into a defined contributions pension scheme. i.e. one where you and your employer pay into a pot of money which will grow to be your pension fund in x years time?

If so, and if you don't really need the money, ask them to pay it in there. If not pay it in yourself and get tax relief at 40% on it. i.e. for every £100 you pay in it only costs you £60. Seems like a good deal to me.

Rgds

__ Richard Buttrey Grappenhall, Cheshire, UK __________________________

What products does your company make/sell? Is there nothing they could give you to the value of your earnings, with suitable tax-dodge to match - obsolete stock, damaged etc.

Then flog it on ebay under a makey-uppey name.

he 40% tax band which means I will lose more of this years bonus too.

No pension i'm afraid but i'm 24 so not too bad. Perhaps this would be a good opportunity to start.

We make software, well infact as the programmer I make software. Also it's educational software and schools don't tend to buy their stuff on ebay.

No 'redundant' computers etc? They could buy a new laptop for the office (and get some tax breaks on it) and then it could find its way into your hands. Then in a couple of years they could write it off as redundant or broken.