Frequently asked questions
How is statutory redundancy pay calculated?
Statutory redundancy pay is based on your age, continuous years of service (up to 20), and weekly pay (capped at £700 for 2026/27). You get half a week's pay for each full year worked when under 22, one week's pay for each year aged 22–40, and one and a half week's pay for each year aged 41 or over.
What is the maximum statutory redundancy pay?
For 2026/27, the maximum is £21,000 — based on 20 qualifying years × 1.5 weeks × £700 weekly pay cap. This applies to employees aged 41 or over with at least 20 years' service.
Is statutory redundancy pay tax-free?
Generally yes. Statutory redundancy pay is exempt from income tax and National Insurance, as it falls within the £30,000 termination payment exemption. Enhanced redundancy pay above the statutory amount may be taxable depending on how it is structured.