What is Pay in Lieu of Notice (PILON)?

PILON is payment made to an employee when their employment is terminated immediately without serving their notice period. Under post-2018 UK tax rules, basic PILON is subject to standard PAYE Income Tax and NICs.

Is Pay in Lieu of Notice (PILON) subject to income tax and National Insurance?

Yes, under UK Post-Employment Notice Pay (PENP) rules, PILON is treated as standard taxable employment earnings subject to normal PAYE Income Tax and Class 1 National Insurance.

United KingdomUK Employment Rights Act 1996Business

UK Statutory Notice Period & PILON Calculator

Calculate minimum UK statutory employment notice period entitlement and Pay in Lieu of Notice (PILON) based on continuous years of service under the Employment Rights Act 1996.

Employment & Work Redundancy Pay & Layoffs Notice Period & PILON Pay in Lieu of Notice (PILON)

Calculated Result

Total Statutory Notice Pay (PILON)

£3,000

Calculator Inputs

Continuous Years of Employment Service

years

Quick select:

Gross Weekly Pay (£)

Quick select:

Calculated Result

Total Statutory Notice Pay (PILON)

£3,000

Statutory Minimum Notice Entitlement

4 weeks

Calculation Methodology

Statutory notice: 1 week if employed 1 month to 2 years; 1 week per full year of service (2 to 12 years); capped at 12 weeks. PILON Pay = Weeks × Weekly Pay.

Important Legal & Educational Disclaimer

Calculates UK statutory minimum notice (1 week per year between 2-12 years, max 12 weeks). Contractual notice clauses may grant longer notice.

This calculator is designed for educational and informational purposes only based on public statutory frameworks. The outputs do not constitute binding financial, tax, or legal advice. We assume no liability for decisions made based on these estimations. Always verify with the relevant official authorities or a certified professional advisor.

Frequently Asked Questions

Under the Employment Rights Act 1996, statutory notice is 1 week for service between 1 month and 2 years, plus 1 week for each additional complete year up to a statutory cap of 12 weeks.

Related Calculators

Recommended tools and calculators tailored to your current calculation

Explore all tools

United Kingdom

UK Statutory Notice Period & PILON Calculator

Calculator Inputs

Calculation Methodology

Important Legal & Educational Disclaimer

Frequently Asked Questions

Related Calculators

UK Statutory Redundancy Pay Calculator (£700 Weekly Cap)

UK Statutory Shared Parental Pay (ShPP) Calculator

UK Statutory Neonatal Care Pay (SNCP) Calculator

UK Statutory Sick Pay (SSP) & Qualifying Days Calculator

UK Statutory Adoption Pay (SAP) Calculator

UK Statutory Paternity Pay (SPP) Calculator

UK Apprenticeship Levy & £15,000 Annual Allowance Calculator

UK Statutory Carer's Leave Entitlement Calculator