Redundancy Package
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Join Date: Jan 2004
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Redundancy Package
Heard a rumour sourced from inside PJHQ that the planned redundancy package that people would be offered to get the RAF down to 40000 people would be :
4 x your salary and then forgoing any pension rights.
But is redundancy taxable ?
Does it include flying pay/additional pay ?
Can anyone shed any more light on this ?
4 x your salary and then forgoing any pension rights.
But is redundancy taxable ?
Does it include flying pay/additional pay ?
Can anyone shed any more light on this ?
Join Date: Aug 2003
Location: Hampshire
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Redundancy is governed by QRs and you will find details there, but in a nutshell, and assuming that a change of QRs has not been hurried through to make it affordable, the maximum payout is 18 months basic pay tax free if you have five or more years to serve. There is a sliding scale if you have less than 5 years to go and you may not have to complete 16 years to be eligible for an immediate pension, but you will have to wait for the detials if/when they are published. (The statutory minimum is one weeks pay for every year served). On top of your redundancy you would be entitled to your pension and gratuity if you have completed 16 years. The gratuity is currently untaxed, but the pension counts as income.
Under the QR scheme and by way of example, a level 5 Sqn Ldr with 20 years service at redundancy would get:
Pension: £14952
Gratuity: £44856
Redundancy Pay Off:£66133
Thus tax free lump sum = £110989 + Pension.
You can also commute some of the pension for more cash under the resettlement commutation scheme which could raise another £25065 at cost to the pension; however take advice before you consider the option as it can be an expensive way to raise money in the long term.
HEALTH WARNING - I wouldn't be surprised if the scheme in QRs gets amended at short notice to make it affordable, but in the worst case you cannot be given less than the statutaory minimum of a weeks pay per year of service and your pension is sacrosanct.
Rgds
BATs
Under the QR scheme and by way of example, a level 5 Sqn Ldr with 20 years service at redundancy would get:
Pension: £14952
Gratuity: £44856
Redundancy Pay Off:£66133
Thus tax free lump sum = £110989 + Pension.
You can also commute some of the pension for more cash under the resettlement commutation scheme which could raise another £25065 at cost to the pension; however take advice before you consider the option as it can be an expensive way to raise money in the long term.
HEALTH WARNING - I wouldn't be surprised if the scheme in QRs gets amended at short notice to make it affordable, but in the worst case you cannot be given less than the statutaory minimum of a weeks pay per year of service and your pension is sacrosanct.
Rgds
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Join Date: May 2004
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Can't see them getting away with asking for a foregoing of pension rights.
Perhaps this may refer to the immediate pension - my reading of QRs is that, if leaving the service voluntarily (ie on redundancy terms) a pro-rata IP (3% of the 37 year pension for every year of service) can be awarded even if you are short of your 16/38 point. The red pen may well be coming out for this regulation!
Suspect the preserved pension is beyond reach and, as this would not generate immediate savings, probably does not register on the bean-counters short range radar!
Perhaps this may refer to the immediate pension - my reading of QRs is that, if leaving the service voluntarily (ie on redundancy terms) a pro-rata IP (3% of the 37 year pension for every year of service) can be awarded even if you are short of your 16/38 point. The red pen may well be coming out for this regulation!
Suspect the preserved pension is beyond reach and, as this would not generate immediate savings, probably does not register on the bean-counters short range radar!
