Pension Tax-Free Lump Sum: How the 25% Rule Works (2026/27)
You can normally take 25% of your pension as a tax-free lump sum, capped at £268,275. Here is exactly how the rule works…
Work out your statutory minimum notice and what it is worth.
Service so far:
Weekly pay used:
Statutory minimum from an employer: 1 week once you have 1 month's service, then 1 week per full year, capped at weeks. The minimum you must give an employer is 1 week (after 1 month). Your contract may require more - check it.
Statutory minimum notice
Statutory minimum only. Your contract, garden leave or pay-in-lieu terms may differ.
Weeks of statutory notice your employer must give at each length of service.
| Length of service | Notice weeks | Notice pay |
|---|---|---|
| Scenario | Weeks | Notice pay | |
|---|---|---|---|
Enter the date you are handing in (or have handed in) your notice and the length of notice you have to give, and the tool counts forward to your leaving date. It is a dates calculator, not a tax tool, so there are no rates to worry about, just a clear answer to one question: when does your job actually end?
Your notice period is the amount of warning you and your employer must give each other before your employment ends. It runs from the day notice is given to the day the contract terminates. During that time you are still employed, still paid, and still bound by your contract unless your employer agrees otherwise. Getting the end date right matters because it decides when your final salary lands, when your holiday is paid out, and the earliest date you can start somewhere new.
There are two figures in play, and the calculator works with whichever applies to you: the statutory minimum set by law, and the contractual notice written into your employment agreement. You give whichever is longer.
Statutory notice is the legal floor. Once you have worked for an employer for at least one month, the minimum notice an employer must give you is set by length of service, and an employee must give at least one week's notice after a month's service. The widely used UK statutory scale, set out by the government, works like this for notice from the employer:
Your contract can offer more than the statutory minimum, and many do, especially for managers and specialists where one or three months is common. Your contract cannot offer less than the statutory floor; if it tries to, the statutory figure wins. When you use the notice period calculator, put in the notice you are genuinely required to give, which is the longer of the two. If your contract says one month and your statutory entitlement is one week, you give one month.
You can confirm the current statutory rules on the government's own page, gov.uk: handing in your notice, which sets out both the employee and employer minimums.
The formula the calculator uses is straightforward in plain words:
Leaving date = the day after your notice is given + the length of your notice period
The detail that trips people up is when the clock starts. Notice usually begins the day after you hand it in, not the same day, unless your contract says otherwise. So if you resign on a Monday with one week's notice, the week is counted from Tuesday, and your last working day is the following Monday. For notice expressed in months, you count calendar months: notice given on the 10th with one month's notice ends on the 10th of the next month, with the last working day being the day before, the 9th, depending on how your contract defines it. Because contracts vary on whether notice includes or excludes the day it is given, the calculator lets you see the date so you can check it against your own wording.
Three things to settle before you trust the date:
Priya is a marketing executive in Leeds. Her contract says she must give one month's notice. She decides to resign and hands her signed letter to her manager on Wednesday 10 June 2026.
Her notice runs from the day after she gives it, so the clock starts on Thursday 11 June 2026. One calendar month later lands on Friday 10 July 2026, which becomes her leaving date. Her last working day is therefore 10 July 2026 (or the last working day before it if the 10th were a weekend). That gives her a clean answer for a new employer asking when she can start: the following Monday, 13 July 2026.
Now compare a second case. Sam has worked at a small engineering firm for six complete years and has no written notice clause longer than the statutory minimum, so the statutory scale applies. Six complete years means six weeks' notice. If Sam resigns on Monday 1 June 2026, the six weeks run from Tuesday 2 June 2026 and end on Monday 13 July 2026. Sam owes far more notice than a colleague who joined last year, purely because of length of service, which is exactly the kind of detail the notice period calculator surfaces before you commit to a start date elsewhere.
You stay on full pay through your notice period as normal, and your final payslip is usually issued on your normal pay date in the month your employment ends. Any holiday you have accrued but not taken is paid out in that final payslip. If you want to sanity-check what your last pay packet looks like after tax and National Insurance, run the figure through our salary calculator, which shows take-home pay for the 2026/27 tax year. To see how much untaken leave you are owed, the holiday entitlement calculator works out your accrued days up to your leaving date.
One point on tax: a normal final salary and a holiday payout are taxed in the usual way through PAYE. Payments connected to ending employment, such as some redundancy sums, can be treated differently. If your departure is a redundancy rather than a resignation, the redundancy pay calculator estimates your statutory entitlement, which is separate from your notice pay.
Working your full notice is the default, but it is not the only outcome. Two alternatives change how your leaving date feels, though not always the date itself.
Garden leave means your employer tells you to stay away from work during your notice while still paying you and keeping you employed. Your leaving date is unchanged; you are simply not in the building. You remain bound by your contract, so you usually cannot start a new job until the notice period ends.
Pay in lieu of notice (PILON) is where your employer pays you for the notice period instead of having you work it, and your employment ends immediately or on an agreed earlier date. This brings your actual last day forward. PILON is normally taxable as earnings through PAYE. If PILON applies to you, your leaving date for the calculator is the agreed termination date, not the date your notice would have run to.
Notice period rules come from employment law that applies across England, Wales and Scotland, so the statutory minimums in this notice period calculator are the same wherever you work in Great Britain. Northern Ireland has its own employment legislation, but the core statutory notice framework follows the same one-week-per-year pattern. Unlike income tax, which has separate Scottish rates, or stamp duty, which is a different tax in each nation, your notice period does not change by region. What does vary is your contract, so the written terms your employer gave you always take priority where they exceed the legal floor.
This notice period calculator gives estimates for guidance only and is not personal employment, tax or financial advice; check your own contract and speak to your employer or an adviser for your specific situation.
Works out the notice you or your employer must give. Two things apply: your contractual notice, and the statutory minimum — and whichever is longer is what governs. Many people assume the contract is the whole answer, which for long-serving employees it often is not.
The statutory floor is asymmetric. An employer must give one week per complete year of service, up to twelve weeks; an employee need only give one week regardless of length of service, unless the contract says more. Someone with fifteen years’ service is entitled to twelve weeks from their employer but may owe only one.
Planning your exit usually means a few numbers at once. Once you have your leaving date, check your final take-home with the salary calculator, work out leave owed with the holiday entitlement calculator, and if your role is being made redundant, estimate your payout with the redundancy pay calculator.
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