Should I take voluntary redundancy?
A £45,000 package on the table looks like a windfall. But part of it is taxed, it has to bridge you to the next job, and walking away trades a known wage for the unknown. Here's a real one worked all the way through — on 2026/27 rates — and then the bit no payout calculator touches: whether leaving is actually the right call.
First: what's really in the envelope
Take someone on £52,000, age 45, with 8 years' service, offered a total of £45,000 — made up of £38,000 redundancy, £5,000 pay in lieu of notice and £2,000 of accrued holiday. The famous £30,000 tax-free rule only covers the genuine-redundancy part; everything else is taxed as ordinary pay.
Your £45,000 package, after tax
£52,000 salary · 8 years' service · age 45
£45,000 offered, £38,860 in hand. The first £30,000 is tax-free; the £8,000 above it and the £7,000 of notice-and-holiday stack on this year's salary, so they're taxed at 40% (with employee NI on the wage parts only — never on the redundancy excess). Two things worth knowing: the £38,000 redundancy part is £30,490 above the statutory minimum of £7,510, so it's genuinely enhanced — and you could pay that £8,000 excess straight into a pension and keep the £3,200 of tax it would otherwise cost.
How far does it actually get you?
A lump sum is really time. Against essential outgoings of £2,400 a month, £38,860 buys about 16 months of runway — comfortably past a six-month job search, with room to choose the right next thing rather than the first. That cushion is the real safety the package buys, and it's the number to weigh before the headline.
Take it, or not? The two futures
"Not taking it" here means staying in your current role. So the fair comparison is two years of cash either way: stay and keep earning, or take the package, spend ~6 months finding a new £46,000 role, and bank the difference.
Stay where you are
£52,000 salary, kept for two years
Take the package & leave
£38,860 now + a new £46k role after ~6 months
Over two years, leaving is about £12,385 ahead — because the tax-free-ish lump sum more than covers a few months without pay, even taking a slightly lower-paid next role. That tips the money axis to +2.32. But change one guess — a year to find work, or a pay cut to your next job — and the gap narrows fast. The money case for a package is only as strong as your honesty about what comes next.
And then the half money can't show
This is where redundancy is different from a pay rise: it's mostly a money-for-life trade. Greener scores both sides of that. The security you'd give up barely favours staying (a team that's shedding people isn't as safe as it feels), and it's set against the relief of leaving, a forced fresh start, the time the runway buys, and going on your own terms. Those net to a life score of +1.62, and with the money also ahead the verdict lands at +1.96 — "clearly greener if you go." But it's your weights that move it: tell the calculator a new job would take a year, or that staying feels rock-solid and the routine matters to you, and that answer tightens or flips. The package was never just the number on the letter — it's what's left after tax, the months it buys, and what leaving does to the rest of your life.
If all you're offered is the statutory minimum
The £45,000 above is an enhanced package — generous, and not what most people get. In the majority of redundancies the employer pays only the statutory minimum, and it's usually compulsory: the role is going whether you'd choose it or not. Statutory pay follows a fixed formula — half a week's pay for each year you were under 22, one week for each year aged 22–40, one-and-a-half weeks for each year 41 or over — capped at 20 years and at £751 a week (2026/27). You need at least two years' service; under that, there's no statutory entitlement at all.
It comes to a lot less than an enhanced offer — but because it's almost always under £30,000 it's entirely tax-free, so the figure quoted is the figure that lands:
| Your situation | Statutory pay | Runway* |
|---|---|---|
| £28k · age 27 · 3 years | £1,615 | under a month |
| £52k · age 45 · 8 years | £7,510 | ~3 months |
| £35k · age 45 · 10 years | £8,077 | ~3½ months |
| £40k · age 58 · 20 years | £21,404 | ~9 months |
*Runway against £2,400/month of essentials — yours will differ.
Our £52k example would get £7,510 on statutory terms, not £38,860 — about three months' runway, not sixteen. And when it's compulsory, "take it or not" isn't the question: switch the tool to "No — the role's going" and it drops the verdict for a runway-first view. At three months' cushion against a six-month search it'll tell you you're three months short — so the job is to plan that gap now. Three things worth doing: check the figure is right (the calculator works out your statutory entitlement for you), ask whether enhanced terms or outplacement support are on the table, and still use the life axis to weigh what comes next, not just what you're owed. Open a statutory-only example →
Weigh your own package
Open this example, then put in your real offer, your outgoings, how long a search might take and what leaving is worth to you. If the role's going regardless, there's a runway-first mode for that too. Everything recomputes live, in your browser — nothing you type is uploaded.