23/10/2026
Being made redundant from a tech company? Your severance package could contain a costly tax trap.
Some employers are offering enhanced redundancy payments on condition that employees waive their right to pursue employment-related complaints.
But there's something you need to establish before signing: **How much of your severance package is actually tax-free?**
In Ireland, statutory redundancy is tax-free. Certain additional termination payments can also qualify for valuable tax exemptions.
However, holiday pay, contractual bonuses and other taxable payments don't automatically become tax-free simply because they're included in a severance package.
And where an enhanced payment is conditional on waiving employment rights, the wording and nature of the payment deserve particular attention.
In this video, I explain how redundancy payments are taxed in Ireland, the three main exemption calculations and what to check before signing.
For independent advice on redundancy and termination payments, visit https://taxunwrapped.ie
**Would you trust your employer's HR department to calculate the tax on your severance package correctly?**