How long will my redundancy payout last?
The number a laid-off person actually needs is not the gross package, or even the net package — it'smonths of normal life the money buys while you find the next job. This briefing shows the runway method with FY 2026-27 figures. The runway panel in the calculator computes it live from your own inputs.
§1The runway formula
Two divisions, two runways:
- Full-replacement runway = net package ÷ normal monthly take-home pay. "The package replaces 10.6 months of my salary."
- Essentials-only runway = net package ÷ monthly essential expenses. "Covering only rent, food and bills, it lasts 16.7 months."
Everything else in this briefing is about getting the two denominators honest: the net package (not gross) and your real take-home (not salary ÷ 12).
§2Step 1 — your net package, not the gross
A $100,000 redundancy package is not $100,000 of runway. Part is tax-free (up to $13,598 + $6,801 per completed year of service for a genuine redundancy in 2026-27), the excess is taxed as an ETP at 32% (17% if you're 60 or over), and unused leave has a flat 32% withheld. Thecalculator's payslip produces the net figure; thetax guide explains every rule.
§3Step 2 — your real monthly take-home
Your runway denominator is what your salary actually paid you each month, computed with the full 2026-27 resident scales:
- Income tax brackets — 0%, 15% (cut from 16% on 1 July 2026), 30%, 37%, 45%.
- The Low Income Tax Offset (up to $700, tapering out by ~$66,667).
- The Medicare levy, including the low-income phase-in ($28,011–$35,014 for singles).
- HELP/STSL repayments — 15c per dollar of repayment income above $69,528.
- The new $1,000 instant work-related deduction (from 1 July 2026, no receipts needed).
Super doesn't appear here: the 12% guarantee is paid on top of salary and stops with the job, but it was never part of take-home.
§4Worked example: $110,000 salary, $75,000 net package
Salary $110,000, no HELP debt, standard $1,000 deduction → taxable income $109,000. Income tax $23,220, Medicare levy $2,180 → net $84,600 a year, $7,050 a month.
A net redundancy package of $75,000 ÷ $7,050 = 10.6 months of full salary replacement. If essential expenses are $4,500 a month, the essentials-only runway is $75,000 ÷ $4,500 =16.7 months.
§5The essentials-only runway
The full-replacement number answers "how long until my lifestyle changes"; the essentials number answers "how long until I'm in trouble". Count housing, food, utilities, transport, insurance and minimum debt repayments. The gap between the two runways is your negotiating room — on job offers, on relocation, on retraining.
§6The Centrelink gap at the start of the runway
Redundancy and leave payouts trigger a JobSeeker Income Maintenance Period: Services Australia treats the payout as income for roughly the number of weeks of pay it represents, and JobSeeker doesn't start until it ends — plus a one-week Ordinary Waiting Period, plus a Liquid Assets Waiting Period if savings exceed roughly $5,500 (single) / $11,000 (couple).Lodge your Centrelink claim immediately — waiting periods run from lodgement, so every week of delay is a week of support lost at the far end. Full detail:Redundancy and the Centrelink IMP.
§7HELP debt and the Medicare Levy Surcharge trap
Two assessment-time surprises can shorten a runway after the fact. First, HELP: "repayment income" includes the taxable part of your package, so the termination-year tax return can include a large compulsory repayment (15c per dollar above $69,528; 17c above $129,717; capped at 10% of repayment income). Second, the Medicare Levy Surcharge: a big taxable payout can push your income for surcharge purposes over the $105,000 singles tier — if you don't hold private hospital cover, that's an extra 1–1.5% levy no one warns you about. Keep a buffer unspent until the return is lodged.
Frequently asked questions
How do I work out how long my redundancy payout will last?
Divide your net (after-tax) redundancy package by your normal monthly take-home pay. A $75,000 net package against a $7,050 monthly take-home is about 10.6 months of full salary replacement. If you only cover essential expenses, divide by your monthly essentials instead — the same package covering $4,500 of essentials lasts about 16.7 months.
Should I use my gross or net redundancy payment?
Net. The gross package overstates your runway because part of it is withheld as tax. A genuine redundancy is tax-free up to a limit ($13,598 + $6,801 per completed year of service in 2026-27), with the excess taxed as an ETP — so calculate the net figure first, then divide.
Does Centrelink pay JobSeeker straight after redundancy?
Usually not. Redundancy and leave payouts trigger an Income Maintenance Period: Services Australia treats the payout as income for roughly the number of weeks of pay it represents, delaying JobSeeker. Lodge your claim immediately anyway — waiting periods run from lodgement.
Does my HELP (HECS) debt affect the runway?
Yes, twice. Your normal take-home is lower while repaying (15c per dollar above $69,528 of repayment income in 2026-27), and the taxable part of the package counts as repayment income in the termination year, which can trigger a large compulsory repayment at assessment.
What monthly figure should I use for essential expenses?
Housing (rent or mortgage), food, utilities, transport, insurance and minimum debt repayments — the budget you would actually run on while job hunting. Exclude discretionary spending; the point of the essentials runway is the worst-case number.
Tax scales, LITO, Medicare thresholds and STSL figures verified 14 Jul 2026 against the sources in thesource register. Centrelink waiting-period figures are per current Services Australia guidance and are indexed — confirm on servicesaustralia.gov.au. General information only, not financial advice.