Calculate your statutory redundancy pay for 2026/27. Weekly cap £751, max 20 years service, tax-free up to £30,000. Updated for 6 April 2026 rates.
Source: GOV.UK, Redundancy pay
By Konstantin Iakovlev · Founder, Calks.uk
Last updated: · Verified against HMRC and GOV.UK 2026/27 rates
Rates verified: 28 September 2026
Quick Answer
Statutory redundancy pay (2026/27): 0.5 weeks per year aged under 22, 1 week aged 22 to 40, 1.5 weeks aged 41+. Capped at £751/week and 20 years service. Tax-free up to £30,000.
Statutory Redundancy Pay
£3,000.00
5 weeks' pay
Tax-Free (up to £30,000)
£3,000.00
Weekly Pay Used
£600.00
How it's calculated:
Under 22: 0.5 week per year of service
22 to 40: 1 week per year of service
41 and over: 1.5 weeks per year of service
Weekly pay capped at £751. Maximum 20 years counted.
Disclaimer
This calculator is for guidance only. It is not financial or tax advice: check anything you rely on against the official source or a qualified adviser. Rates and figures come from HMRC and GOV.UK and are reviewed for the 2026/27 tax year. Everything is calculated in your browser; nothing you enter is sent to our servers.
How It Works
Statutory redundancy pay is calculated based on your age, length of continuous service (up to 20 years) and weekly pay (capped at £751 for 2026/27, up from £719 in 2025/26). The formula gives 0.5 weeks' pay per year of service under age 22, 1 week per year aged 22–40, and 1.5 weeks per year aged 41 and over. Only full years count, and you need at least 2 years of continuous service to qualify at all. Voluntary redundancy and dismissals that are not redundancies follow different rules.
The maximum statutory redundancy payment is therefore 30 weeks' pay (20 years × 1.5 for over-41s), capped at £22,530 (30 × £751). Take a 45-year-old with 12 years' service earning £650 a week: the 7 years worked between 22 and 40 give 7 weeks at £650, or £4,550, and the 5 years from 41 to 45 give 1.5 weeks each, or £4,875, for a total of £9,425. Because £650 sits below the £751 cap, the full weekly wage counts. Your employer may offer enhanced redundancy pay above the statutory minimum.
Many employers do offer enhanced redundancy through the contract or staff handbook. Typical packages pay 2-4 weeks per year of service without the weekly cap, or a multiple of the statutory figure such as 3 times. Public sector schemes in the NHS, civil service and local government have traditionally paid around a month per year of service. Check your contract, the handbook and any union agreement. An enhanced scheme must be more generous than statutory; if it is not, the statutory figure applies as the floor.
The first £30,000 of any redundancy payment (statutory plus contractual and any ex gratia sum) is tax-free. Amounts above £30,000 are subject to income tax at your marginal rate but not employee NI, although since April 2020 the employer pays NI on the excess. Notice pay, including Payment In Lieu of Notice (PILON), is always taxable under the rules introduced in April 2018, even when it is paid as part of a redundancy package. Ask for the breakdown of any settlement agreement in writing so you can see which elements fall inside the £30,000 exemption.
Redundancy also comes with procedural rights. Where 20 or more redundancies are proposed within 90 days, collective consultation is required, with 30 days' notice if fewer than 100 jobs are affected and 45 days if 100 or more. Selection must rest on fair criteria such as skills, attendance and performance; choosing people on grounds of age, gender or disability is unlawful discrimination. Statutory notice is at least 1 week per year of service, capped at 12 weeks. Employees with 2 or more years' service are entitled to reasonable paid time off to look for work. If you believe the process was unfair, use the internal appeal first and then, if needed, bring a tribunal claim within 3 months.
Example: Age 45, 12 years' service, £650/week salary
- Years aged 22–40: 7 years × 1 week × £650 = £4,550
- Years aged 41–45: 5 years × 1.5 weeks × £650 = £4,875
- Total statutory redundancy: £9,425 (tax-free)
Source: GOV.UK, Redundancy pay
Frequently Asked Questions
- How is statutory redundancy pay calculated in 2026/27?
- For each full year of service you receive 0.5 weeks' pay if you were under 22, 1 week if aged 22-40 and 1.5 weeks if aged 41 or over. A maximum of 20 years count and weekly pay is capped at £751, so the most anyone can receive is 30 weeks at £751, or £22,530. You need at least 2 years of continuous service to qualify. The whole payment is tax-free as long as it stays within the £30,000 limit.
- Is redundancy pay tax-free up to £30,000?
- Yes. The first £30,000 of statutory, enhanced and ex gratia redundancy pay combined is free of income tax and NI. Above that, income tax applies at your marginal rate, but you pay no employee NI, although your employer has paid NI on the excess since April 2020. Notice pay, including Payment In Lieu of Notice, has been fully taxable since April 2018 however it is packaged, so it never counts towards the £30,000 exemption.
- Can my employer pay more than statutory redundancy pay?
- Many do, through the contract or staff handbook. Common enhanced schemes pay 2-4 weeks per year of service with no weekly cap, or a multiple of the statutory amount such as 3 times. Public sector employers in the NHS, civil service and local government have traditionally offered around a month per year. Whatever the scheme, statutory redundancy pay is the floor, so an enhanced package can never leave you with less than the statutory formula produces.
- What are my rights when I am made redundant?
- If 20 or more redundancies are planned within 90 days, your employer must consult collectively, giving 30 days' notice for fewer than 100 redundancies and 45 days for 100 or more. Selection must use fair criteria, and picking people because of age, gender or disability is unlawful. You are owed at least 1 week's notice per year of service, capped at 12 weeks, and with 2 or more years' service you can take reasonable paid time off to look for work. Appeal internally first, then to an employment tribunal within 3 months.