Extending the redundancy tax credit

The cessation date for the redundancy tax credit has been extended to payments made on or after 1 Apr 2011.

Section ML 2(1) of the Income Tax Act 2007

The redundancy tax credit ceased for redundancy payments made on or after 1 October 2010. This was as a result of the income tax rate changes in Budget 2010 and, in particular, the introduction of the 33% tax rate.

However, because this rate does not become fully effective until 1 April 2011, section ML 2 has been amended so that the cessation date is payments made on or after 1 April 2011.

The amendment applies from 21 December 2010.