When employment ends, your last payment is usually more than a normal pay cycle. It brings together several entitlements that are each calculated differently, and taxed differently, which is why the total can be hard to predict without a calculator.
Notice or pay in lieu — if you're not required to work out your notice period, you're generally paid for it instead. Unused annual leave is paid out in full, and for many award and agreement-covered employees it attracts leave loading (commonly 17.5%) on top. Unused long service leave is paid where you've met the qualifying period. If the role is being made redundant, you may also receive redundancy pay scaled to your years of service.
Ordinary components — salary, unused annual leave and (usually) LSL — are taxed, though lump-sum leave can be taxed at concessional rates in a genuine redundancy. Genuine redundancy pay is tax-free up to a base amount plus an extra amount for each completed year of service (for 2025–26, a base of $13,100 plus $6,552 per year). Anything above that, and other termination payments, are taxed as an Employment Termination Payment (ETP), often at a capped concessional rate up to a threshold and at higher rates beyond it.
An employee with 5 years' service, a $90,000 salary, four weeks' notice paid out, and three weeks of unused annual leave would receive roughly $6,900 of notice, about $5,200 of leave (plus loading if eligible), and — if genuinely redundant — a redundancy amount that is largely tax-free thanks to the $13,100 + 5 × $6,552 = $45,860 tax-free cap. The calculator above lets you test your own mix.
Is unused sick leave paid out? No — personal/carer's (sick) leave is not paid out on termination unless an award or contract specifically says so.
Do I get redundancy pay if I resign? No. Redundancy pay applies when the employer ends the role; it doesn't apply to resignations, most dismissals for conduct, or casual employment.
Is my whole payout taxed at my marginal rate? Not necessarily — genuine redundancy amounts within the tax-free cap are not taxed at all, and ETPs receive concessional treatment up to the relevant cap.
This calculator uses current published rates from Australian government and regulator sources. The result is an estimate for general guidance — it does not constitute personal financial advice. For decisions about your circumstances, consult a registered financial adviser, tax agent, or other professional. See editorial standards for how DecisionLab sources and updates its calculator data.
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