Directors Redundancy

Are you a company director that has been trading for over 2 years?

The average claims for Directors Redundancy are over £9000 in the United Kingdom.

If you are considering closing your company, due to financial difficulty, then a Directors Redundancy payment can help to pay the insolvency practitioners to legally shut your business.

Claiming Directors Redundancy is also a popular way to repay any business personal guarantee debts held against the company directors.

In our Directors Redundancy guide, we explain everything you need to know about the costs of legal way to make a director redundant.


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Are directors entitled to redundancy?



When can a claim be made for director redundancy?



Can I claim redundancy if my company isn’t facing liquidation?




Popular Questions

Can directors claim redundancy in liquidation?

Directors’ redundancy claims are very common during liquidation in the United Kingdom.

Many directors are entitled to redundancy payments when their company enters liquidation.

If you do meet the criteria, claims can be made from the National Insurance Fund via the Redundancy Payments Service (RPS), and are tax-free.

You can ask for a form from the liquidator or request one online.

Can a sole director claim redundancy pay?

All employees including directors can claim redundancy pay and other amounts they are owed following the liquidation of their company.

This includes sole directors who were both the only employee and also 100% shareholders and where put the company into liquidation themselves.

How do you calculate directors redundancy claims?

Eligible directors are entitled to get the following directors redundancy claims payouts:

  • Under 22 years of age – Half a week’s pay for each full year of service
  • Between 22 and 41 years of age – One week’s pay for each full year of service
  • Over 41 years of age – One and a half week’s pay for each full year of service

Is directors redundancy claims taxable?

Directors’ redundancy claims are tax-free.

The shareholder directors of limited companies cannot claim corporation tax relief for any payouts.

Struggling To Pay Business Debts

Here are some other business debt guides if you are struggling with different types of debts: