There is still some confusion around the fact that an employer will have a tax indemnity in a compromise agreement to ensure that if HMRC makes a demand for payment in tax in relation to a specific employee, that employer is indemnified. As UK employment law solicitors, we regularly advise employees facing redundancy on their redundancy rights. One way to mitigate against a tax indemnity is for the employee to have the opportunity to discuss/negotiate with HMRC to reach some agreement before payment is made. We always advise that compromise agreements are amended to include this provision, otherwise employees may be faced with an unwanted tax bill.
If you require further information about UK employment law or seek clarification with regards to the terms of your compromise agreement, please contact us at enquiries@rtcooperssolicitors.com or visit one of the following pages on employment law:
- http://www.rtcoopers.com/practice_employment.php
- http://www.rtcoopers.com/faq-redundancyemployee.php
- http://www.employmentlawyersinlondon.com/video.php
- http://www.employmentlawyersinlondon.com
- http://www.compromiseagreementlonuk.com/
© RT COOPERS, 2012. This Briefing Note does not provide a comprehensive or complete statement of the law relating to the issues discussed nor does it constitute legal advice. It is intended only to highlight general issues. Specialist legal advice should always be sought in relation to particular circumstances.
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