NHS Redundancy Pay & Tax Calculator
Calculate your estimated redundancy pay and tax-free lump sum with our **NHS Redundancy Calculator** for the **2026/27 year**. Under Section 16 of the Agenda for Change contract, NHS staff are entitled to **1 month's actual pay for each complete year of service** (minimum 2 years' service, up to a maximum of 24 years). This free tool automatically calculates your gross redundancy package, applies the **£30,000 tax-free limit**, and estimates your net payout.
Reference Salary Tables & Quick Facts
NHS Redundancy Overview & Calculation Basis
This calculator operates under the official 2026/27 Agenda for Change and NHS Terms and Conditions of Service. All calculations are performed in real time as you adjust inputs.
| Deduction / Allowance | Rate / Threshold (2026/27) |
|---|---|
| Personal Allowance | £12,570 (Standard Tax Code: 1257L) |
| National Insurance | 8% on earnings between £12,570 and £50,270 (2% above) |
| NHS Pension Tiers | 5.2% to 12.5% based on pensionable pay |
Frequently Asked Questions
NHS Redundancy Pay Rules (Section 16)
Redundancy pay in the NHS is governed by **Section 16 of the Agenda for Change Terms and Conditions**. It is significantly more generous than statutory redundancy and is calculated based on these key rules:
- 1 Month's Pay Per Year: You receive 1 month's reckonable pay for each year of continuous NHS service.
- Minimum Service: You must have a minimum of **2 years** of continuous NHS service to qualify.
- Maximum Cap: The calculation is capped at a maximum of **24 years** of service (meaning a maximum of 24 months' pay).
- Salary Cap: The salary used in the calculation is capped at the maximum of Band 8c, or your actual salary if it is lower.
