Redundancy Pay Calculator

If your role is made redundant in the UK, you are legally entitled to Statutory Redundancy Pay (SRP) provided you have completed at least 2 continuous years of service with your employer. Your statutory entitlement is determined by an established formula combining your age during each year of service, your total completed years of employment, and your weekly gross pay (up to the statutory government cap).

Redundancy Pay Calculator

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Age determines your statutory multiplier (0.5x, 1.0x, or 1.5x weeks)
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Must be at least 2 full continuous years (statutory cap: 20 years)

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Statutory redundancy pay caps weekly earnings by law

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Total Statutory Redundancy Pay

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Weeks’ pay entitled
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Weekly pay rate used
Tax-Free
Tax status

Statutory Weeks Breakdown by Age

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Under age 22 (0.5 wk/yr)
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Age 22 to 40 (1.0 wk/yr)
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Age 41 and older (1.5 wks/yr)

Tax note: Redundancy payments up to £30,000 are free from UK Income Tax and National Insurance.

This calculator works out your exact statutory redundancy entitlement, itemises the weeks of pay earned across each age bracket, applies the relevant annual statutory weekly cap, and checks your total package against the £30,000 tax-free threshold.

If you also work part-time or need to estimate your ongoing net income, see our Take-Home Pro Rata Pay Calculator to project your monthly take-home pay under different employment arrangements.

How Statutory Redundancy Pay (SRP) Is Calculated in the UK

The statutory redundancy formula looks back across up to 20 completed years of continuous service, assigning a specific number of weeks’ pay for each year based on your age at that time:

Statutory Age Brackets & Multipliers

Age During Year of ServiceEntitlement per Full Year of Service
Under age 220.5 week’s pay for each full year
Age 22 to 401.0 week’s pay for each full year
Age 41 and older1.5 weeks’ pay for each full year

Statutory Limits & Caps

Under UK employment law, two statutory caps apply to redundancy calculations:

  1. Length of service cap: Only your most recent 20 completed years of service count toward the calculation.
  2. Maximum total weeks: The absolute maximum statutory entitlement is capped at 30 weeks’ pay.
  3. Weekly pay cap: Your weekly earnings used in the calculation are capped at statutory rates updated on 6 April each year:
Redundancy Dismissal DateStatutory Weekly Pay CapMaximum Statutory Redundancy Pay (30 Weeks)
On or after 6 April 2026£751 per week£22,530.00
6 April 2025 to 5 April 2026£719 per week£21,570.00
6 April 2024 to 5 April 2025£700 per week£21,000.00

Note: If your actual gross weekly pay is lower than the statutory cap, your actual weekly wage is used instead.

Statutory Redundancy Worked Examples

The table below illustrates statutory redundancy payouts across various age, service, and salary combinations:

AgeContinuous ServiceAnnual SalaryWeekly Gross PayStatutory Cap UsedTotal Weeks EntitledTotal Statutory Redundancy Pay
304 years£26,000£500.00£500.00 (Actual)4.0 weeks£2,000.00
388 years£45,000£865.38£719.00 (Capped)8.0 weeks£5,752.00
4510 years£35,000£673.08£673.08 (Actual)12.5 weeks (5 yrs @ 1.5 + 5 yrs @ 1.0)£8,413.50
5215 years£52,000£1,000.00£719.00 (Capped)20.5 weeks (11 yrs @ 1.5 + 4 yrs @ 1.0)£14,739.50
6222 years£60,000£1,153.85£719.00 (Capped)30.0 weeks (Capped at 20 yrs @ 1.5)£21,570.00

How Redundancy Pay Works for Part-Time Staff

Under the Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000, part-time employees have the exact same legal rights to statutory redundancy pay as full-time staff.

The calculation uses your actual gross weekly part-time wage:

Part-Time Weekly Pay = (Full-Time Equivalent Salary ÷ FT Weekly Hours) × Your Actual Weekly Hours ÷ 52

For example, an employee working 20 hours per week earning £350 per week with 6 years of service aged 45 (entitled to 8.0 weeks’ pay) receives:

8.0 weeks × £350.00 = £2,800.00 statutory redundancy pay

For full details on establishing your baseline part-time earnings, try our full Pro Rata Salary Calculator on the homepage.


Tax on Redundancy Payments: The £30,000 Exemption

Under UK tax legislation, statutory redundancy pay and genuine ex-gratia redundancy severance payments are free from Income Tax and statutory employee payroll deductions up to £30,000.

What Is Tax-Free (Up to £30,000):

  • Statutory redundancy pay
  • Enhanced / contractual redundancy payments
  • Voluntary severance payments

What Is Always Taxed as Normal Pay:

  • Pay in Lieu of Notice (PILON): Post-Employment Notice Pay (PENP) is fully subject to Income Tax and statutory payroll deductions, even if paid as part of a redundancy settlement.
  • Accrued annual leave: Payment for untaken statutory holiday entitlement is taxed as normal salary. See our guide on how to calculate pro rata holiday in the UK for leave valuation rules.
  • Contractual bonuses or unpaid wages: Standard PAYE deductions apply.

If your total genuine redundancy package exceeds £30,000, only the amount above £30,000 is subject to standard Income Tax.

Statutory vs. Enhanced (Contractual) Redundancy Pay

Statutory redundancy pay represents the legal minimum your employer must provide. Many UK employers offer Enhanced (Contractual) Redundancy Schemes, which may provide:

  • Uncapped weekly pay: Using your actual full weekly salary rather than the statutory government cap.
  • Enhanced multipliers: Paying 2 to 4 weeks of salary per year of service.
  • Lower service threshold: Offering redundancy payments with less than 2 years’ service.

Check your employment contract, staff handbook, or union collective agreement to confirm whether your employer operates an enhanced redundancy policy.

Frequently Asked Questions

Who is eligible for statutory redundancy pay in the UK?

To qualify for statutory redundancy pay, you must:

  1. Be legally classed as an employee working under a contract of employment.
  2. Have completed at least 2 full continuous years of service with your employer.
  3. Have been dismissed due to genuine redundancy (the role no longer exists or the workplace is relocating/closing).

Self-employed contractors, agency workers, and employees with less than 2 years of service are not entitled to statutory redundancy pay.

Is redundancy pay taxed in the UK?

Statutory redundancy pay and genuine severance compensation are tax-free up to £30,000. Any redundancy amount above £30,000 is subject to standard Income Tax. Other termination payments — such as notice pay (PILON) and accrued holiday pay — are never covered by the £30,000 exemption and are always taxed via standard PAYE.

How is a “week’s pay” calculated for redundancy?

If your pay does not vary, a week’s pay is your contractual gross weekly wage (or annual gross salary divided by 52). If you work irregular hours or earn overtime, your employer must average your gross pay over the 12 weeks leading up to the redundancy notice date (or 52 weeks under certain employment arrangements).

Can an employer pay less than statutory redundancy pay?

No. Statutory redundancy pay is a mandatory legal right set by UK legislation. An employer cannot contract out of statutory redundancy pay, nor can they pay less than the statutory amount. If an employer is insolvent and cannot pay, employees can claim statutory redundancy pay directly from the government’s Insolvency Service (Redundancy Payments Service).

What happens if I find a new job during my redundancy notice period?

If you are serving statutory notice and wish to leave early to start a new job, you must submit a formal written notice request (known as a Section 136 / Section 142 notice under the Employment Rights Act 1996) asking your employer to bring your termination date forward. If your employer agrees, you retain your entitlement to redundancy pay. If you leave without permission, you risk forfeiting your redundancy payment.

Does taking voluntary redundancy affect my statutory pay calculation?

Voluntary redundancy calculations follow the same statutory principles as compulsory redundancy, although employers offering voluntary redundancy typically offer an enhanced financial package (such as uncapped weekly pay or an additional lump-sum incentive) to encourage applications.

Need to calculate pro rata take-home pay for a new role? Use our Take-Home Pro Rata Pay Calculator.

For standard part-time pay calculations, try our full Pro Rata Salary Calculator on the homepage.

To understand employment contract terms, read our guide on what FTE means in the UK.