Enhanced redundancy — what will you take home?

Reviewed: September 2026

Many employers offer enhanced or contractual redundancy above the legal minimum. Enhanced redundancy compensation may qualify for the £30,000 combined tax-free termination payment exemption — but PILON, holiday and wages in the same package are usually taxed separately.

Statutory vs enhanced

Statutory redundancy is the legal minimum based on age, service and capped weekly pay. Enhanced redundancy is anything your employer adds on top — both may count as qualifying termination payments for tax purposes when they are genuine compensation for losing your job.

Optional: expand the detailed payment breakdown in the calculator to enter statutory and enhanced separately. For a quick estimate, enter the combined redundancy/severance figure in one box.

GOV.UK statutory redundancy calculator (entitlement only — not full package take-home).

Examples

£12k statutory + £15k enhanced + £5k PILON

£27k qualifying termination may be within the £30,000 exemption. The £5,000 PILON is usually taxed as earnings in full.

Try the calculator with your figures →