Redundancy Pay
Calculator 2025/26

Statutory redundancy pay is calculated using three factors: your age at the time of redundancy, your complete years of continuous service (capped at 20 years), and your weekly pay (capped at £719 in 2025/26). You receive: half a week's pay per year worked under age 22, one week's pay per year aged 22–40, and one and a half weeks' pay per year aged 41 or over.

The maximum statutory redundancy payment in 2025/26 is £21,570. This applies to someone aged 61 or over with 20 years' service earning at least £719/week. The calculation is 20 years × 1.5 × £719 = £21,570.

Statutory redundancy pay is entirely tax-free. Any additional contractual or ex-gratia redundancy payments on top are also tax-free up to a combined total of £30,000. Amounts above £30,000 are subject to income tax and in some cases National Insurance.

You must have at least 2 years of continuous employment with your employer to qualify for statutory redundancy pay. Part-time employees qualify on the same basis as full-time employees. Agency workers and the self-employed do not qualify.

Yes. Many employers offer enhanced redundancy schemes above the statutory minimum, often defined in your employment contract or staff handbook. Enhanced payments are still tax-free up to the £30,000 combined threshold. Check your contract and any collective agreements before accepting any settlement.