Redundancy Calculator Australia โ FY 2025-26
Calculate tax on your redundancy payment. Shows the tax-free component ($13,100 + $6,552/year), ETP tax at 17% or 32% depending on preservation age, leave entitlement tax, and the whole-of-income cap. Covers genuine and non-genuine redundancy. Updated for FY 2025-26.
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How to Use This Calculator
Redundancy Tax tab
Enter your total redundancy payment, completed years of service, date of birth (year and month), other taxable income this financial year, and whether the redundancy is genuine or not genuine. The calculator shows your tax-free component, ETP tax, any above-cap tax, and net payment.
Full Payout Breakdown tab
Enter the redundancy amount plus unused annual leave and long service leave values. The calculator shows how each component is taxed separately: redundancy (with tax-free + ETP), and leave (capped at 32% for genuine redundancy).
Age Strategy tab
Enter your current age and redundancy amount to compare the tax if you leave now versus waiting to preservation age. Shows the potential saving from the 32% to 17% rate drop and checks Age Pension age eligibility.
Share your result
All inputs are encoded in the URL. Click Share to send your exact calculation to your accountant or financial adviser.
The Formula
Tax-Free = $13,100 + ($6,552 × Completed Years of Service)
ETP (Taxable Component):
ETP = Total Redundancy − Tax-Free Component
ETP Tax Rate:
Under preservation age: 32%
At/above preservation age: 17%
Cap Checks:
ETP cap: $260,000 (FY 2025-26)
Whole-of-income cap: $180,000 (other income + ETP ≤ $180K)
Amount above either cap: taxed at 47%
Leave Tax (genuine redundancy):
Unused annual leave + LSL: taxed at maximum 32%
Worked Example
Genuine redundancy, 10 years service, age 45, $120K payment, $80K other income
Step 1: Tax-free component
Step 2: ETP calculation
Step 3: Cap checks
Step 4: Tax calculation
Verdict: Of the $120,000 redundancy, $78,620 is completely tax-free. The remaining $41,380 is taxed at 32% (under preservation age), resulting in $13,242 tax and a net payment of $106,758.
Redundancy Tax Rates (FY 2025-26)
Tax-free redundancy limits
| Parameter | Value |
|---|---|
| Base amount | $13,100 |
| Per completed year of service | $6,552 |
| ETP cap | $260,000 |
| Whole-of-income cap | $180,000 |
| Under preservation age rate | 32% |
| At/above preservation age rate | 17% |
| Above cap rate | 47% |
Preservation age lookup
| Date of Birth | Preservation Age |
|---|---|
| Before 1 July 1960 | 55 |
| 1 July 1960 – 30 June 1961 | 56 |
| 1 July 1961 – 30 June 1962 | 57 |
| 1 July 1962 – 30 June 1963 | 58 |
| 1 July 1963 – 30 June 1964 | 59 |
| After 30 June 1964 | 60 |
NES minimum redundancy entitlement
| Years of Service | Redundancy Pay |
|---|---|
| 1 – 2 years | 4 weeks |
| 2 – 3 years | 6 weeks |
| 3 – 4 years | 7 weeks |
| 4 – 5 years | 8 weeks |
| 5 – 6 years | 10 weeks |
| 6 – 7 years | 11 weeks |
| 7 – 8 years | 13 weeks |
| 8 – 9 years | 14 weeks |
| 9 – 10 years | 16 weeks |
| 10+ years | 12 weeks |
Based on the base rate of pay (ordinary hours only). Small business (<15 employees) may be exempt.