Redundancy Pay Calculator
Calculate your UK statutory redundancy pay for 2025/26, see how much tax you owe on payments above £30,000, and work out the net value of your full leaving package including PILON, holiday pay, and bonuses.
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How to Use This Calculator
Statutory Redundancy tab
Enter your weekly gross pay, years of service, and current age. The calculator applies the correct age-band multipliers (0.5, 1, or 1.5 weeks per year), caps your weekly pay at £719, and limits service to 20 years. You get a year-by-year breakdown showing exactly how many weeks you are entitled to.
Tax on Redundancy tab
Enter your total redundancy payment (statutory + enhanced combined) and your annual salary. The calculator splits your payment at the £30,000 threshold, calculates income tax on the excess at your marginal rate, and confirms that employee National Insurance is not payable on redundancy pay.
Total Package tab
Enter each component of your leaving package: redundancy pay, PILON (payment in lieu of notice), unused holiday pay, and any bonus. The calculator shows which parts are tax-free and which are fully taxable, then gives you the total net amount you will receive.
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The Formula
UK statutory redundancy pay is calculated using age-banded multipliers applied to each year of service:
Age under 22 at that year: 0.5 weeks' pay
Age 22–40 at that year: 1.0 week's pay
Age 41+ at that year: 1.5 weeks' pay
Weekly pay = average of last 12 weeks' gross pay (capped at £719 for 2025/26)
Statutory Redundancy = Total Weeks × Capped Weekly Pay
Maximum statutory redundancy = £21,570
Tax on redundancy above £30,000:
Taxable = Total Redundancy − £30,000
Income Tax = Taxable amount at marginal rate (20% / 40% / 45%)
Employee NI = £0 (exempt on all redundancy pay)
The age-band calculation works backwards from your current age. If you are 45 with 8 years' service, the calculator checks your age at each of those 8 years and applies the correct multiplier. Years where you were 41+ attract 1.5 weeks; years where you were 22-40 attract 1 week.
PILON and holiday pay are treated as normal earnings and are subject to both income tax and employee National Insurance through PAYE.
Example
Sarah — Office Manager, 45, Birmingham
Sarah earns £35,000/year (£673/week gross) and has worked for her employer for 8 years. She is being made redundant and offered an enhanced package of £25,000 plus 3 months' PILON and 12 days' unused holiday.
Statutory Redundancy tab
Sarah's weekly pay of £673 is below the £719 cap, so the full amount is used. Her 8 years span ages 38-45, giving her 5 years at the 1.5x rate (ages 41-45) and 3 years at the 1x rate (ages 38-40). That is 10.5 weeks at £673 = £7,067 statutory redundancy.
Total Package tab
Sarah's employer offers an enhanced package. Her full leaving settlement:
The £25,000 redundancy is entirely tax-free (under the £30,000 threshold). The PILON and holiday pay are taxed as earnings. Sarah takes home £32,463 from a gross package of £35,365.