{"slug":"uk-redundancy-package","name":"UK Redundancy Package Calculator — what you actually take home","category":"earn","tags":["income","employment","tax"],"aliases":["redundancy package calculator","tax on redundancy pay calculator","redundancy tax calculator","redundancy holiday pay calculator","redundancy notice period calculator","redundancy calculator ni","what do i get made redundant"],"region":"GB","tagline":"Redundancy pay, notice and untaken holiday together — and which parts of it the £30,000 exemption does not cover.","endpoint":"https://xearno.tools/api/v1/tools/uk-redundancy-package","page":"https://xearno.tools/t/uk-redundancy-package","description":"Being made redundant pays you three different things, taxed three different ways, and the letter usually quotes only the first. Statutory redundancy pay is tax-free, and shares a £30,000 exemption with any ex-gratia top-up. Notice pay is not covered by it — since the PENP rules a payment in lieu is taxed as earnings whatever it is called. Accrued untaken holiday is not covered either. So \"redundancy is tax-free up to £30,000\" is true of one component and false of the other two, and someone with twelve weeks of notice and a fortnight of holiday can be several thousand pounds out. This adds all of it up and splits the tax the way HMRC does, including the National Insurance boundary, which sits in a different place again. Northern Ireland is included, with its own higher limits.","inputSchema":{"type":"object","properties":{"age":{"description":"Your age when the job ends","type":"number","minimum":16,"maximum":100,"default":45},"serviceYears":{"description":"Complete years of service Only full years count for redundancy pay. Under 2 years there is no statutory redundancy — but notice and holiday are still owed.","type":"number","minimum":0,"maximum":60,"default":10},"weeklyPay":{"description":"Gross weekly pay (£)","type":"number","minimum":0,"default":700},"holidayDays":{"description":"Untaken holiday days owed","type":"number","minimum":0,"maximum":60,"default":5},"noticeTreatment":{"description":"How is your notice being handled? Both are taxed as earnings. Since the 2018 PENP rules, calling a payment \"compensation\" no longer makes notice tax-free.","type":"string","enum":["pilon","worked"],"default":"pilon"},"exGratia":{"description":"Employer top-up above the statutory minimum (£) An enhanced or ex-gratia payment. Shares the £30,000 exemption with your statutory redundancy pay.","type":"number","minimum":0,"default":0},"taxRate":{"description":"Your marginal income tax rate A large payout can push you into a higher band for the year; this applies one rate to the taxable part.","type":"string","enum":["20","40","45"],"default":"40"},"niRate":{"description":"Your National Insurance rate NI is due on notice and holiday pay, never on the termination payment — a different boundary from income tax.","type":"string","enum":["8","2","0"],"default":"8"},"nation":{"description":"Where do you work? Northern Ireland sets its own, higher statutory limits: £783 a week and £23,490 maximum.","type":"string","enum":["gb","ni"],"default":"gb"}},"required":[],"additionalProperties":false},"methodology":["Three payments, added together: statutory redundancy pay (ERA 1996 s.162 — the age-banded walk, weekly pay capped at £751 in GB or £783 in NI, total capped at £22,530 / £23,490), statutory notice pay (s.86 — one week per complete year to a maximum of twelve, at FULL weekly pay, since the s.227 cap is a redundancy-pay rule and does not reach notice), and accrued untaken holiday at the daily rate.","Tax: the £30,000 exemption (ITEPA 2003 Part 6 Ch.3) applies to TERMINATION payments — statutory redundancy plus any ex-gratia or enhanced amount. Notice pay and holiday pay are earnings and fall outside it entirely; since the PENP rules of April 2018 a payment in lieu is taxed as earnings whatever the contract calls it.","National Insurance draws its boundary somewhere else: employee NI is due on notice and holiday, and is NOT due on the termination amount above £30,000 (the employer pays Class 1A there). Two different lines across one payslip is the single most common source of a wrong expectation.","This applies one marginal rate to the taxable total. A large payout can straddle bands, and the tax is usually settled through PAYE and then corrected — the figure here is the right size, not a P800.","Scope: statutory minimums. A contractual enhanced-redundancy scheme pays more, and belongs in the top-up field. Pension contributions, salary sacrifice, student loan deductions and unpaid wages are not modelled."],"usage":"POST https://xearno.tools/api/v1/tools/uk-redundancy-package with a JSON body matching inputSchema."}