Redundancy pay calculator
Statutory redundancy pay depends on three things: your age, your full years of service, and your weekly pay, capped at £751 a week and £22,530 in total from 6 April 2026. Most calculators stop there. This one also answers the question that actually matters when an offer lands: what is the package worth after tax?
Statutory minimum: 12 weeks' pay
£8,400.00
Statutory redundancy pay under £30,000 is entirely tax-free, you would receive the full amount.
How the statutory figure is built
Half a week's pay per full year worked under age 22, one week for years at 22-40, and one and a half weeks for years at 41 or older, counting back from your current age, with service capped at 20 years and weekly pay capped at £751.00 (from 6 April 2026). The absolute maximum anyone can receive is £22,530. Employers can and often do pay more; the excess above £30,000 is taxed as income in the year you receive it, no employee NI, but income tax at your marginal rate, which the figure above computes against your salary so far this year. A big payout late in the tax year can therefore be taxed less the following April, timing matters, and so does asking for part of the excess as an employer pension contribution, which escapes tax entirely.
How redundancy pay is taxed
The first £30,000 of a genuine redundancy payment is tax-free, that covers the statutory amount for everyone (the statutory maximum is £22,530) and usually part of an enhanced package too. Everything above £30,000 is taxed as income at your marginal rate in the year you receive it, though no employee National Insurance is due. Watch two traps: a large excess can push you into higher bands or the £100k taper for that one year, and holiday pay or pay in lieu of notice inside the package is ordinary pay, taxed and NI'd in full, never part of the £30,000.
Worth negotiating
- Pension instead of cash: the excess above £30,000 paid as an employer pension contribution escapes income tax entirely.
- Timing: a payment landing after 6 April falls into a year where you may have little other income, taxed far more lightly.
- Check the statutory floor: an “enhanced” offer below the statutory figure above isn't enhanced; the statutory amount is a legal minimum after two years' service.
Caps checked 2026-08-28 against gov.uk redundancy rights. Assumes a genuine redundancy payment; settlement agreements can differ, take advice on large packages.