Redundancy Pay and Pensions

Does redundancy pay (in lieu of notice) that is paid directly into a pension scheme via salary sacrifice count as earnings for the relevant tax year?

AFAIK, pay in lieu of notice is treated equivalently to normal pay. Once you salary sacrifice it, it should be equivalent to any other pay you salary sacrifice. Does it count as earnings? That depends on the context. It wouldn't count as directly taxable (that being the point of the salary sacrifice), but it would count in the calculations for a high earner's tapered pension Annual Allowance.

Could you please clarify the context? If, for example, 60k was put directly into the pension via salary sacrifice and total earnings (other) for the tax year were only 10k, would tax have to be paid on 50k or on none of it?

Hi,
Only the part of the redundancy payment over the tax exempt threshold of £30,000 can count as relevant UK earnings.
Thank you.

Admin 20's response refers to the tax treatment of sums paid as compensation for the loss of employment, however it does *not* apply to payment in lieu of notice (PILON). It is quite common to receive one final payment from an employer and then need to carefully divide it up into amounts of redundancy compensation, PILON, holiday payout, etc. to correctly determine the tax position. An introduction to some of this can be found at https://www.gov.uk/termination-payments-and-tax-when-you-leave-a-job/what-you-pay-tax-and-national-insurance-on
If the payment is truly all PILON, then it would *all* be taxable as regular earnings... except that it then was salary sacrificed, removing it from taxable earnings. 60k is the exact amount of the usual pensions Annual Allowance, and the suggested total earnings of 60k+10k are well below the point where high earner's Annual Allowance tapering would start.
Assuming you've never taken pension benefits in a way which would trigger the Money Purchase Annual Allowance, the entire 60k would be tax free, PROVIDED it is the only contribution going into your pension in this tax year. If more than 60k has gone into the pension in the tax year, you exceed the Annual Allowance for the year and may have liability to a Pensions Savings Tax Charge... except you may have unused Annual Allowance from the previous 3 years which in many but not all cases you can carry forward to cover the excess contributions without a charge. Unfortunately it's all rather complicated and each answer sometimes ends up posing several more questions :-)