See the minimum redundancy pay, and how much tax is taken out.
How this works in 3 steps
1. Type the years Full years in the job.
2. Type the weekly pay Ordinary hours, before tax.
3. Read the result The minimum pay, and the tax taken out.
Example: Sam worked 5 full years and is paid $1,500 a week.
2 Result
The minimum pay is about $15,000. Tax taken out is about $0.
Minimum pay$15,000
Weeks10
Tax-free$47,603
Tax taken out$0
See the detailed breakdown
Weeks under the law
10
Minimum redundancy pay
$15,000.00
Payment used for tax
$15,000.00
Tax-free amount
$47,603.00
Amount that is taxed
$0.00
Tax taken out
$0.00
The 2026–27 tax-free limit for a genuine redundancy is $13,598 plus $6,801 for each completed year, which is $47,603.00. The taxed part of a genuine redundancy uses the termination cap of $270,000. Under preservation age the rate is 32% up to the cap. At or over that age it is 17%. Above the cap it is 47%. The tax office rounds the tax to the nearest dollar.
Unused leave is taxed separately and is not in this figure. A business with fewer than 15 employees may not have to pay these weeks. Rates last checked 22 October 2026.
Questions
How many weeks does the NES require?
4 weeks at 1 year, then 6, 7, 8, 10, 11, 13, 14 and 16 weeks, and 12 weeks once service is 10 years or more. Under 1 year, the NES redundancy scale is zero. Pay is the base rate for ordinary hours, not overtime or penalties.
What is tax-free in 2026–27?
For a genuine redundancy, $13,598 plus $6,801 for each completed year of service. The excess is an excluded employment termination payment. The ETP cap for 2026–27 is $270,000. The whole-of-income cap does not apply to that excluded part.
Does every employer pay this?
Most small-business employers, those with fewer than 15 employees, do not have to pay NES redundancy. Casuals, employees with less than 12 months’ service, and some fixed-term employees are also outside the NES scale. This page does not turn those exclusions into a switch. It shows the scale and the tax.