Redundancy pay is compensation employees may be entitled to when their role is made redundant. Statutory redundancy pay depends on age, length of service, and weekly pay, subject to a cap.
Tax-free element
The first £30,000 of most genuine redundancy payments can usually be paid free of tax and National Insurance, though contractual or enhanced payments may be treated differently.
Tax rules depend on individual circumstances and can change. This glossary is general information rather than personalised tax advice.