- Work out the statutory part first with the statutory redundancy calculator. Everything the employer pays above that figure is the ex-gratia lump sum.
- Holiday pay, arrears and contractual pay in lieu of notice are ordinary pay. Keep them out of the lump sum figure.
- Only complete years count for the exemptions, unlike statutory redundancy where part-years count.
- Waiving a pension lump sum to get the increased exemption or a bigger SCSB is a real trade-off. For large packages, an hour with a tax adviser is worth it. The full rules are in our redundancy and tax guide.
Redundancy tax calculator: how much of your lump sum is tax-free
Statutory redundancy is tax-free, full stop. This tool covers the ex-gratia payment on top: it applies the basic exemption, the increased exemption and SCSB, then shows what is left to tax.
Only the extra your employer pays. Statutory redundancy is tax-free and not entered here.
Whole years only: 9 years and 11 months counts as 9.
Gross pay including bonuses and benefits. Needed for the SCSB formula; leave blank to skip it.
From your employer's occupational pension scheme. Enter 0 if you have no scheme or have waived the lump sum.
The rules: basic exemption of €10,160 plus €765 for each complete year of service; up to €10,000 more as the increased exemption (reduced by any pension lump sum); or SCSB (average annual pay ÷ 15 × years of service, minus the pension lump sum). You get whichever single figure is highest, within the €200,000 lifetime limit.
The three reliefs, side by side
Basic exemption
€10,160 + €765 per complete year of service. No conditions.
20 years: €25,460
Increased exemption
Up to €10,000 more, minus any pension lump sum. Once in 10 years.
35 years, €5,000 pension: €41,935
SCSB
Average annual pay ÷ 15 × complete years, minus pension lump sum.
18 years, €95,000 over 3 years, €11,000 pension: €27,000
The three examples are Revenue’s own worked examples (John, Tom and Eileen on revenue.ie). The calculator reproduces each of them.
Before you enter numbers
Questions people ask
Is statutory redundancy taxed in Ireland?
No. The statutory redundancy lump sum (2 weeks per year of service plus 1 week, capped at €600 a week) is completely tax-free. Only the ex-gratia part, the amount your employer pays on top, can be taxed, and that is what this calculator looks at.
What is the basic exemption?
A tax-free allowance on ex-gratia termination payments of €10,160 plus €765 for each complete year of service with the employer. Ten complete years gives €17,810. Time before and after a career break counts; the career break itself does not.
When do I get the increased exemption?
You can add up to €10,000 to the basic exemption if you have not received a tax-free termination payment above the basic exemption in the previous 10 years, and you are either not in an occupational pension scheme or you give up your right to a tax-free lump sum from it. Any pension lump sum you are due is deducted from the €10,000; if it is €10,000 or more, the increased exemption is nil.
How is SCSB calculated?
Standard Capital Superannuation Benefit: your average annual pay over the last 36 months, divided by 15, multiplied by your complete years of service, minus any tax-free pension lump sum received or due. It usually beats the basic exemption for long service and higher pay. You use whichever single relief is highest, never both.
What tax applies to the rest?
The taxable balance is added to your income for the year and taxed at your marginal rate of income tax plus USC. PRSI does not apply to the taxable part of a termination lump sum. Your employer applies the exemption through payroll; if too much tax is taken, claim it back through myAccount.
Is there a limit on tax-free termination payments?
Yes. Revenue applies a lifetime limit of €200,000 on tax-free termination payments across all employers. Below that, the basic exemption can be claimed again with a different, unconnected employer; the increased exemption only once in any 10-year period.
Is pay in lieu of notice tax-free?
If your contract provides for pay in lieu of notice, it is taxed in full as normal pay and the exemptions do not apply. If your contract does not provide for it and it is paid as part of the termination package, it may be included in the lump sum that qualifies for the exemptions.
Sources: exemption amounts, conditions and worked examples from revenue.ie, Basic exemption, Increased exemption and SCSB (all published 24 April 2026); PRSI and USC treatment from citizensinformation.ie. Figures checked on 3 September 2026.