Severance Pay Calculator 2026

Portuguese severance for collective dismissal, job-position extinction or unsuitability is worth 14 days of base pay plus seniority payments per year of service from 1 May 2023; earlier service counts at 12, 18 or 20 days per year, depending on when the contract was signed. Fixed-term expiry by the employer pays 24 days/year. Simulate the amount and the notice period.

How severance is calculated in 2026

The daily value is monthly base pay plus seniority payments divided by 30 (article 366(2)(c) of the Labour Code), and fractions of a year count proportionally. Service is segmented by the regimes in force in each period: 14 days/year from 01/05/2023 (Law 13/2023) and 12 days/year between 01/10/2013 and 30/04/2023 for contracts signed after October 2013. The monthly pay considered is capped at 20× the minimum wage — €18,400 in 2026, with the RMMG at €920 (Decree-Law 139/2025) — and the global amount is capped at 12 months' pay or 240× the minimum wage (€220,800).

Older contracts: transitional regimes

Article 5 of Law 69/2013 preserves the historical rates. Contracts signed before 01/11/2011: 1 month per year until 31/10/2012 (with no pay cap on that tranche), 20 days until 30/09/2013, 18 days in the first 3 years of the contract and 12 days afterwards until 30/04/2023, and 14 days from 01/05/2023 — with a guaranteed minimum of 3 months of base pay plus seniority payments. Contracts signed between 01/11/2011 and 30/09/2013 count 20 days/year until 30/09/2013 and then follow the same phasing. The calculator applies these cut-offs and caps automatically and shows the breakdown by period.

Notice periods and income tax

The employer must give 15, 30, 60 or 75 days' notice depending on whether service is under 1 year, 1 to 5, 5 to 10, or 10 or more years (article 363(1) of the Labour Code); without notice, the pay for the missing period is due. For income tax, severance is excluded from IRS up to the average regular remuneration of the last 12 months multiplied by the years of service (article 2(4) of the income tax code) — the exclusion does not cover directors and managers and is lost if a new engagement with the same entity follows within 24 months. Check your net pay with the salary simulator or talk to HVR about payroll processing.

Fixed-term contracts

When the employer lets a fixed-term contract expire, compensation is 24 days per year (articles 344(2) and 345(4) of the Labour Code, as amended by Law 13/2023), with 18 days/year applying to service before 01/05/2023. If the worker terminates the contract, no compensation is due.

Frequently asked questions

How many days of severance per year in 2026?

14 days of base pay plus seniority payments per full year, fractions counted proportionally (article 366(1) of the Labour Code) — applied, under the dominant reading, only to service from 01/05/2023.

Do older contracts count differently?

Yes: 1 month/year until 31/10/2012 (pre-11/2011 contracts, with a 3-month floor), 20 days until 30/09/2013, 18/12 days until 30/04/2023 and 14 days since then (article 5 of Law 69/2013).

Is severance taxed?

Only the part above the average regular remuneration of the last 12 months × years of service (article 2(4) of the income tax code); directors and managers are taxed in full.

What is the notice period?

15, 30, 60 or 75 days, depending on service (article 363(1) of the Labour Code). Without notice, the pay for the missing period is due.

What about fixed-term contracts?

24 days/year when the employer lets the contract expire (articles 344 and 345 of the Labour Code); before 01/05/2023 the rate was 18 days/year. No compensation if the worker terminates.