How we calculate

Our sources, in order

1. The legislation itself — the Fair Work Act 2009 (Cth) and National Employment Standards for notice, annual leave and redundancy; the long service leave Act of each state and territory; ATO rulings and schedules for tax.

2. Official guidance — the Fair Work Ombudsman, state government long service leave pages (NSW, Victoria, Queensland, WA, SA, Tasmania, ACT, NT), and the ATO's published rates and caps.

3. Nothing else. We do not copy other calculators. Where a competitor's figure disagrees with ours, we re-check against the first two sources — that process has caught errors in both directions, and we publish corrections here when we make them.

Long service leave

Long service leave is state and territory law, not part of the NES, so each state has its own engine rules: accrual rate, vesting point, pro-rata window and the endings that qualify. We accrue exactly (fractions of a week are never rounded mid-calculation) and round only the displayed result.

One disclosed difference: Victoria's official guidance rounds the accrued weeks to two decimal places before valuing them. For 11 years' service on $1,100 a week, the official method gives $10,483; exact accrual gives $10,486.67. We show the exact figure and say so on the page — your employer's payroll method governs what you are actually paid.

In Quick mode, service is entered as years and months; in Exact mode we count real calendar days. For Victoria, exact mode follows the Act's own basis — total weeks of continuous service divided by 60.

Tax estimates (Final Pay and Redundancy)

Tax is the hardest part of a final pay, because the ATO taxes termination payments under special schedules rather than as ordinary wages. Our method:

Leave and wage components (unpaid wages, notice, unused annual leave and long service leave) are estimated by stacking: we work out the tax on your income for the year without this payment, then with it, using the FY2026-27 resident rates plus the 2% Medicare levy. The difference is the estimate. Because real withholding depends on your actual year-to-date income, the Final Pay calculator lets you enter it (it defaults to your weekly pay × 52).

Genuine redundancy components follow the ATO's Schedule 7 approach: on a genuine redundancy, withholding on unused annual leave and long service leave lump sums is capped at 32%, and we apply that cap. The redundancy payment itself is tax-free up to the statutory limit ($13,598 plus $6,801 per completed year of service for 2026-27); the excess is an employment termination payment taxed at 32% (or 17% if you have reached preservation age) up to the $270,000 ETP cap, and 47% above it.

Estimates exclude the Low Income Tax Offset, HELP/HECS debts, the Medicare levy surcharge and low-income Medicare reductions. Any difference between withholding and your actual liability is settled in your tax return — which is why we label every figure an estimate.

Annual leave and leave loading

Annual leave accrues on ordinary hours worked, so we use the hour-ratio method the Fair Work Ombudsman uses: accrued hours = ordinary hours worked × (entitlement weeks ÷ 52) — four weeks, or five for award-defined shiftworkers. Leave loading (17.5% by default, editable) comes from awards and agreements, not the NES, and the Leave Loading calculator shows the loading-versus-shift-penalties comparison that several awards require: whichever is higher.

Rounding and updates

Money is rounded to the nearest cent only at display; weeks and hours to two decimal places. Financial-year figures (tax brackets, the redundancy tax-free limit, the ETP cap) are versioned in a single rates file and updated every 1 July, or sooner if the ATO revises them. Long service leave rules change rarely; we re-check them against the state Acts at least annually, and the "rules checked" date on each page tells you when.

If you believe a figure is wrong, the fastest check is the worked example on the relevant page — every calculator publishes one with the arithmetic shown.