Redundancy Calculator (Australia)
After 6 years on $1,800 a week, the minimum redundancy pay is 11 weeks, or $19,800. With 4 weeks’ notice paid out it’s $27,000, all tax-free, because the 2026–27 tax-free limit for 6 years is $54,404.
Updated · Australia · 2026–27 ATO limits and Fair Work rules · Estimates only, not tax or legal advice · Built and checked by AI, which can make mistakes
Estimate your redundancy package
Result
This is an estimate. It assumes a genuine redundancy under the National Employment Standards and the ATO’s 2026–27 limits and rates. Awards, enterprise agreements and contracts can give more, some employees and employers are excluded, and leave accrued before August 1993 is taxed differently. The tax shown is withheld from your payment; your final tax is settled in your tax return. This is general information, not tax, legal or financial advice. For your situation, contact the Fair Work Ombudsman, the ATO or a registered tax agent.
Built and checked by AI. AI wrote this calculator and its explanations, researched the rates and ran the tests. AI can make mistakes, and the checks may not catch them all, so confirm anything important with an official source or a qualified professional. How we use AI.
Quick answer
If you’re made genuinely redundant by an employer with 15 or more employees after at least a year, you’re entitled to between 4 and 16 weeks of base pay, depending on your years of service. For 2026–27, the first $13,598 plus $6,801 for each complete year of service is tax-free. Anything above that is taxed at 32% if you’re under 60, or 17% if you’re 60 or older. Unused annual leave and long service leave are taxed at 32%.
How to use the redundancy calculator
- Enter your base pay, weekly or annual, without overtime, bonuses or allowances.
- Enter your years and months of continuous service, your age on your last day and your employer’s size.
- If your employer is offering more than the minimum, enter their redundancy amount.
- Optionally add notice paid out and unused leave, then press Calculate to see your package before and after tax.
Minimum redundancy pay by years of service
These are the minimums under the National Employment Standards, paid at your base rate for ordinary hours.
| Continuous service | Redundancy pay |
|---|---|
| Less than 1 year | Nil |
| 1 year to less than 2 | 4 weeks |
| 2 years to less than 3 | 6 weeks |
| 3 years to less than 4 | 7 weeks |
| 4 years to less than 5 | 8 weeks |
| 5 years to less than 6 | 10 weeks |
| 6 years to less than 7 | 11 weeks |
| 7 years to less than 8 | 13 weeks |
| 8 years to less than 9 | 14 weeks |
| 9 years to less than 10 | 16 weeks |
| 10 years or more | 12 weeks |
The drop from 16 weeks to 12 weeks at 10 years of service is part of the National Employment Standards table, not a mistake.
How redundancy tax is calculated
Tax-free limit (2026–27) = $13,598 + $6,801 × complete years of service
Tax-free amount = the smaller of your genuine redundancy payment and the limit
Taxable part (an employment termination payment) = genuine redundancy payment − tax-free amount
Tax on the taxable part = 32% if under 60, or 17% if 60 or older, up to $270,000; 47% above that
Tax on unused annual leave, leave loading and long service leave = 32%
Your genuine redundancy payment is the redundancy pay plus any payment instead of notice. Unused leave is paid separately and isn’t part of the tax-free amount.
Worked examples
6 years 4 months on $1,800 a week
- Minimum redundancy pay: 6 years falls in the “6 to less than 7” band, which is 11 weeks × $1,800 = $19,800.
- Notice paid out: 4 weeks × $1,800 = $7,200, so the genuine redundancy payment is $27,000.
- Tax-free limit: $13,598 + $6,801 × 6 = $54,404. The whole $27,000 is tax-free.
- Unused annual leave: 3 weeks × $1,800 × 1.175 (17.5% loading) = $6,345, taxed at 32% = $2,030.40.
- Total package: $33,345 before tax, about $31,314.60 after tax.
A $90,000 offer after 4 years
- Tax-free limit: $13,598 + $6,801 × 4 = $40,802.
- Taxable part: $90,000 − $40,802 = $49,198.
- Under 60: $49,198 × 32% = $15,743.36 tax, leaving $74,256.64. At 60 or older, the rate is 17%, so the tax is $8,363.66, leaving $81,636.34.
What counts as a genuine redundancy?
For the tax-free amount to apply, the ATO says the payment must be for a genuine redundancy. Your job must no longer exist, and you must be dismissed before age pension age (67), with the payment made at arm’s length and more than you’d get if you simply resigned. Payments you would have received anyway, such as unused leave or superannuation, aren’t part of it.
Some employees aren’t entitled to redundancy pay under the National Employment Standards, including those working for small businesses with fewer than 15 employees, casuals, and people with less than a year of service. Your award, enterprise agreement or contract may give you more.
When you’d actually use a redundancy calculator
- Checking an offer. Make sure the amount at least meets the legal minimum for your service.
- Planning the months ahead. Know what you’ll actually receive after tax before you budget.
- Deciding on voluntary redundancy. Compare the after-tax payout with staying on.
What this calculator doesn’t include
- Award, agreement or contract redundancy scales that are different from the National Employment Standards.
- Annual leave or long service leave accrued before 18 August 1993, which is taxed under older rules.
- State long service leave rules, which set how much leave you’ve earned. Enter the weeks your employer says you’re owed.
- Non-genuine redundancies, such as payments when you resign, and payments to people aged 67 or older.
- Your final pay for days worked, which is taxed as normal wages.
How we calculate
Minimum redundancy pay uses the National Employment Standards table published by the Fair Work Ombudsman. If you enter an annual salary, we divide it by 52 for the weekly rate. The tax-free limit, employment termination payment (ETP) cap and rates use the ATO’s figures for payments from 1 July 2026: $13,598 plus $6,801 per complete year of service, an ETP cap of $270,000, and withholding of 32% under preservation age (60), 17% at 60 or older, and 47% above the cap. Unused leave on genuine redundancy is withheld at 32%. Amounts are rounded to the cent for display. We review these figures each July.
Sources:
Frequently asked questions
How much redundancy pay am I entitled to?
Under the National Employment Standards, between 4 and 16 weeks of base pay depending on your years of continuous service, if your employer has 15 or more employees. Your award, agreement or contract may give you more.
How much of a redundancy payment is tax-free in 2026–27?
$13,598 plus $6,801 for each complete year of service. For example, after 6 complete years the first $54,404 of a genuine redundancy payment is tax-free.
How is the rest of my redundancy taxed?
The amount above the tax-free limit is an employment termination payment. It’s taxed at 32% if you’re under 60, or 17% if you’re 60 or older, up to $270,000, and 47% above that. These rates include the Medicare levy.
How is unused annual leave taxed on redundancy?
Unused annual leave, leave loading and long service leave accrued after 17 August 1993 are taxed at 32% when paid on a genuine redundancy.
Is payment in lieu of notice tax-free?
It can be part of your genuine redundancy payment, so it counts towards the tax-free amount. Any amount over the tax-free limit is taxed as an employment termination payment.