VSS Modeller

Please download the VSS modeller to get an estimate of your total release payment, including notice pay.

The total release payment is based on the following formula:
One month’s pay for every completed year of service (as at 1 July 2020) with a minimum of five months’ pay and a maximum of ten months’ pay:

Number of years service as of 1 July 2020

Release payment

Up to and including 5 years of service 5 months’ pay
6-9 years of service 1 month’s pay for each completed year of service
10+ years of service 10 months’ pay

For the purposes of calculating the payment, pay will be determined on base salary and will not include any additional allowances or supplements, except where salary protection arrangements are in place.

For part-time staff the relevant salary will be their pro-rata gross pay, not full-time equivalent.

It is expected that in accordance with the HMRC regulations £30,000 of the release payment, excluding notice pay, will be paid without deduction at source of income tax and NI contributions. The pay in lieu of notice included in the total release payment must be subject to tax and NI.

For example:

If a Grade 7 member of staff who has 11 years service applies for the VS Scheme;

The individual will be entitled to 10 months pay in their release payment, as per the guidance above. As the total release payment is inclusive of notice pay and Grade 7 and above members of staff are subject to 3 months notice, 3 of the 10 months worth of pay would be subject to Tax and NI deductions, the remaining payment for 7 months worth of pay would not be subject to tax and NI up to the £30,000 HMRC threshold.

If a Grade 4 member of staff who has 1 years service applies for the VS Scheme; 

The individual will be entitled to 5 months pay in their release payment, as per the guidance above. As the total release payment is inclusive of notice pay and members of staff on Grade 1 to 6 are subject to 1 months notice, 1 of the 5 months worth of pay would be subject to Tax and NI deductions, the remaining payment for 4 months worth of pay would not be subject to tax and NI up to the £30,000 HMRC threshold.