Redundancy Pay Calculator 2026/27
Work out your statutory redundancy pay (weekly pay capped at £751, maximum £22,530) and estimate the tax on your full redundancy package.
Last updated: October 2026 · 2026/27 rates
Your details
Uses the cap for redundancies on or after 6 April 2026.
Only complete years count, up to the most recent 20.
Before tax. Capped at £751 (£783 in Northern Ireland).
Total package (optional)
Non-contractual severance or enhanced redundancy pay.
Pay for your notice period, worked or not. Taxed as earnings.
Taxed as earnings.
Salary already earned this tax year plus any new job before 5 April.
Statutory redundancy pay
£9,012.00
12 weeks × £751.00 a week, from 10 years counted.
Weeks of pay by age band
| Age during year | Years | Rate | Weeks |
|---|---|---|---|
| Under 22 | 0 | × 0.5 | 0 |
| Aged 22 to 40ages 35 to 40 | 6 | × 1 | 6 |
| Aged 41+ages 41 to 44 | 4 | × 1.5 | 6 |
| Total weeks × £751.00 | 12 | ||
Total package and tax
Estimate for 2026/27: the package is added on top of your other taxable pay for the year, with the taxable excess treated as the top slice of income. NI is worked out on annual figures; on a real final payslip it is calculated per pay period, so it can differ. Your employer may first deduct tax using a 0T code, with any overpayment refunded by HMRC later.
How redundancy pay works
How it works
If you are an employee with at least 2 full years of continuous service, your employer must pay statutory redundancy pay. It depends on three things: your age, your length of service and your gross weekly pay.
- Half a week's pay for each full year of service while under 22
- One week's pay for each full year of service while aged 22 to 40
- One and a half weeks' pay for each full year of service while aged 41 or over
Service is capped at 20 years, counted back from the redundancy date, so the most recent years are the ones that count. Weekly pay is capped at £751 for redundancies on or after 6 April 2026 (£783 in Northern Ireland), which makes the maximum statutory payment £22,530 in England, Scotland and Wales.
Each year of service is matched to the age you were throughout that year. Counting back from the redundancy date, the most recent year is the one you spent at your current age minus one, the year before that at minus two, and so on. This is the same method GOV.UK's redundancy pay calculator uses.
Age 45, 10 years, £800 a week. Pay is capped at £751. The ten years counted were spent at ages 44 down to 35. Ages 41 to 44 give 4 years × 1.5 = 6 weeks, and ages 35 to 40 give 6 years × 1 = 6 weeks. That is 12 weeks × £751 = £9,012.
Age 24, 5 years, £400 a week. Two years at ages 22 and 23 give 2 weeks; three years at ages 19 to 21 give 1.5 weeks. 3.5 weeks × £400 = £1,400.
Age 61, 25 years, £1,000 a week. Only the latest 20 years count, all at age 41 or over: 30 weeks × £751 = £22,530, the statutory maximum.
The first £30,000 of statutory redundancy pay and any non-contractual enhanced redundancy or severance pay, taken together, is free of income tax and National Insurance. Anything above £30,000 is taxed as income at your marginal rate, but you pay no employee National Insurance on it; instead your employer pays Class 1A NI at 15% on the excess.
Other parts of a leaving package are treated as normal pay and taxed with income tax and Class 1 NI: unpaid wages, holiday pay, bonuses, and pay for your notice period, whether you work it, take gardening leave or receive a payment in lieu of notice (PILON).
If you do not work your full notice and receive no separate notice pay, HMRC treats the part of your enhanced payment that matches the basic pay you would have earned over the notice period as post-employment notice pay (PENP), taxed as earnings. If you are in that position, enter that amount as notice pay and reduce the enhanced figure to match. Statutory redundancy pay itself is never treated as PENP.
Example: a £9,012 statutory payment plus £30,000 enhanced, £4,000 notice pay and £1,000 holiday pay, for someone on £50,000. The termination payment is £39,012, so £9,012 is taxable. Income tax on the excess is £3,604.80, income tax on notice and holiday pay is £1,946.00 and employee NI is £116.20, leaving £38,345.00 of a £44,012 package.
A large payment can push you into a higher band, or above £100,000 where the Personal Allowance tapers away; see our guide to the £100k tax trap. Employer pension contributions are not taxed up to your £60,000 Annual Allowance, so asking for part of the excess to be paid into your pension can save tax; model it with the pension calculator.
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Reviewed by Alexandre Bernier, LLM (UK), CFP®
Educational tool: estimates only. Not individual financial, investment, tax or legal advice. Using it does not create an adviser-client relationship. Rules and figures change; check them against current HMRC and GOV.UK guidance and speak to a qualified professional. Editorial policy →
Sources
Every rate and threshold used by this calculator is taken from the official pages below. If a figure here disagrees with one of these, the official page is right, please tell us.