Retrenchment Calculator Singapore 2026
Calculate your retrenchment package in Singapore — severance pay, notice in lieu, and unused annual leave payout. Uses MOM's norm of 2 weeks to 1 month per year of service.
MOM norm: 2 weeks to 1 month (~4 weeks) per year of service
IRAS Tax Treatment
Retrenchment benefits are generally NOT taxable under IRAS if received for loss of employment. Notice-in-lieu and unused leave encashment ARE taxable as employment income.
MOM Retrenchment Norm
MOM's guidance on retrenchment benefit is 2 weeks to 1 month of salary per year of service. The exact amount is determined by employment contract, company policy, or collective agreement. Statutory retrenchment benefit is only required for Employment Act Part IV-covered employees with at least 2 years of service.
What's Included in a Retrenchment Package?
- Severance pay (retrenchment benefit) — 2 weeks to 1 month per year of service
- Notice in lieu — if employer terminates immediately
- Unused annual leave encashment
- Pro-rated AWS/bonus (if applicable per contract)
- Ex-gratia payments (discretionary goodwill payments)
Tax Treatment (IRAS)
| Component | Taxable? | CPF? |
|---|---|---|
| Retrenchment benefit | No | No |
| Notice in lieu | Yes | Yes |
| Unused AL encashment | Yes | Yes |
| Ex-gratia (loss of employment) | Usually No | No |
Who is Legally Entitled?
Statutory retrenchment benefit is required for employees who:
- Are covered under Part IV of the Employment Act
- Have served at least 2 years of continuous service
- Are being retrenched due to redundancy or business closure
Source: MOM — Retrenchment