Free online calculator for the Dutch transition payment (transitievergoeding): the statutory severance under Article 7:673 of the Dutch Civil Code, owed upon dismissal, redundancy or non-extension of a fixed-term contract. Applies the 2026 cap (EUR 102,000 or one annual salary if higher) and the salary-base rules of the Besluit loonbegrip.
When is an employee entitled to a transition payment?
The employer owes a transition payment (transitievergoeding) when it gives notice of termination, when the cantonal court dissolves the employment contract at its request, or when it does not continue a fixed-term contract after it expires (Article 7:673(1) of the Dutch Civil Code). The employee builds up the payment from the first working day, including during a probation period, regardless of the length of service or the position held.
If the employee resigns, there is in principle no entitlement, unless the resignation results from seriously culpable acts or omissions of the employer. On termination by mutual consent (a settlement agreement, vaststellingsovereenkomst) there is no statutory entitlement; the parties agree the payment themselves, often using the transition payment as the starting point.
No transition payment is due if the employment ends in connection with or after reaching the Dutch state pension (AOW) age or an agreed retirement age, in case of seriously culpable acts or omissions of the employee, or for employees under 18 who worked on average at most twelve hours a week (Article 7:673(7) of the Dutch Civil Code). In case of seriously culpable conduct of the employee, the cantonal court may still award all or part of the payment if refusing it would be unacceptable (paragraph 8).
How do you calculate the transition payment?
The formula is set out in Article 7:673(2) of the Dutch Civil Code: one third of a monthly wage for each year the employment has lasted, plus a proportional part for the remaining months and days. Two things therefore determine the outcome: the monthly wage and the length of the employment.
The monthly wage
The monthly wage is more than the gross base salary. Under the Besluit loonbegrip vergoeding aanzegtermijn en transitievergoeding (Decree on the wage concept for the notice compensation and the transition payment) and the Regeling looncomponenten en arbeidsduur (Regulation on wage components and working hours), the following count:
- the gross monthly salary (hourly wage times the agreed working hours, or the average over the last twelve months if the hours vary);
- the holiday allowance, divided by twelve: with an 8% holiday allowance that is 8% of the monthly salary;
- a fixed year-end payment or 13th month, divided by twelve;
- overtime pay and shift allowances over the last twelve months, divided by twelve;
- bonuses, profit shares and variable year-end payments over the three calendar years before the year in which employment ends, divided by 36. Years without a bonus count; if the employee was employed for a shorter period, the divisor is adjusted pro rata.
A lease car and expense allowances, among other things, do not count: they are not designated as wage components.
The length of the employment
The length runs from the first day of employment up to and including the last day of employment. Successive contracts with the same employer are added together if there were never more than six months between them, and the same applies to successive employers, for example when a temporary agency worker is hired by the client for the same work (Article 7:673(4) of the Dutch Civil Code). If a transition payment was already paid on an earlier contract, it is deducted from the new one (paragraph 5).
Calculation examples
The calculator above gives the same results for the same data.
Example 1: exactly six years of employment
An employee was employed from 1 January 2020 up to and including 31 December 2025, with a gross monthly salary of €4,500 and 8% holiday allowance. The monthly wage is €4,500 + €360 = €4,860. The transition payment is 6 × €4,860 / 3 = €9,720.
Example 2: 13th month and varying bonuses
An employee was employed from 1 January 2019 up to and including 30 April 2026: 7 years and 4 months. The gross monthly salary is €4,000, with 8% holiday allowance, a 13th month of €4,000 and bonuses of €12,000 (2023), €0 (2024) and €12,000 (2025). The monthly wage is €4,000 + €320 + €333.33 (13th month / 12) + €666.67 (€24,000 / 36) = €5,320.
- 7 full years: 7 × €5,320 / 3 = €12,413.33
- 4 full months: 4 × €5,320 / 36 = €591.11
Transition payment: €13,004.44.
Example 3: short fixed-term contract
An employee with a fixed-term contract from 15 January up to and including 20 March 2025 earned €3,000 a month, without holiday allowance in the wage. That is 2 months and 6 days: 2 × €3,000 / 36 + 6/31 × €3,000 / 36 = €182.80. A short contract therefore also gives rise to a payment.
How much transition payment do you get per year of service?
For each full year of service, the transition payment is one third of a monthly wage. With a monthly wage of €4,000 (including holiday allowance and other components) this comes to:
| Years of service | Number of monthly wages | With a monthly wage of €4,000 |
|---|---|---|
| 1 year | 0.33 | €1,333.33 |
| 2 years | 0.67 | €2,666.67 |
| 5 years | 1.67 | €6,666.67 |
| 10 years | 3.33 | €13,333.33 |
| 15 years | 5.00 | €20,000.00 |
| 20 years | 6.67 | €26,666.67 |
| 30 years | 10.00 | €40,000.00 |
Maximum transition payment per year
The transition payment is never higher than the statutory maximum of the year in which the employment ends, or one year's wage if that is higher (Article 7:673(2) of the Dutch Civil Code). The maximum is adjusted every year on 1 January in line with collective wage developments and applies to employment that ends on or after that date (paragraph 3).
| Year employment ends | Maximum |
|---|---|
| 2026 | €102,000 |
| 2025 | €98,000 |
| 2024 | €94,000 |
| 2023 | €89,000 |
| 2022 | €86,000 |
| 2021 | €84,000 |
| 2020 | €83,000 |
Source: Article 7:673(2) of the Dutch Civil Code in the versions in force on 1 January of each year (wetten.overheid.nl).
An example: someone earning €10,000 a month has an annual wage of €120,000. For that employee the maximum in 2026 is €120,000 instead of €102,000.
Dismissal, non-renewal and settlement agreement
The same calculation applies to dismissal with permission from the UWV, dissolution by the cantonal court, collective redundancy and non-renewal of a fixed-term contract by the employer. In case of seriously culpable acts or omissions of the employer, the cantonal court may also award fair compensation (billijke vergoeding).
In a settlement agreement, employer and employee set the payment themselves. The transition payment is then the usual starting point of the negotiation, but not a statutory minimum. With the settlement agreement generator you can draw up such an agreement, with the transition payment calculation as an annex.
Under certain conditions the employer may deduct certain costs from the transition payment, such as the costs of measures to prevent or shorten unemployment and the costs of improving the employee's broader employability during the employment (Article 7:673(6) of the Dutch Civil Code). The costs must have been specified to the employee in writing in advance and the employee must have agreed in writing in advance, unless a collective labour agreement obliges the employer to incur those costs (Besluit voorwaarden in mindering brengen kosten op transitievergoeding, Article 2).
What does this calculator not cover?
This tool calculates only the statutory transition payment under Article 7:673 of the Dutch Civil Code. It does not include: fair compensation, a higher payment in a settlement agreement, deductions of costs under paragraph 6, wage tax and social plan payments. For a binding assessment, consult a Dutch employment lawyer.
Common calculation mistakes
The most common mistakes in calculating the transition payment:
- leaving the holiday allowance out of the monthly wage;
- forgetting the 13th month or the bonuses over the three calendar years before the year in which employment ends, or skipping years without a bonus;
- counting a lease car or expense allowance;
- not counting earlier fixed-term contracts with gaps of no more than six months;
- applying the old calculation from before 2020 (accrual per full half year and a higher accrual after ten years of service).
Employees who suspect an underpayment must file a request with the cantonal court within three months after the employment ends (Article 7:686a(4) of the Dutch Civil Code). Anyone who misses this deadline loses the right, regardless of the size of the underpayment.
What if the employer pays the transition payment late?
Statutory interest is due on the transition payment from one month after the day on which the employment contract ended (Article 7:686a(1) of the Dutch Civil Code). If the employment ends on 31 May, interest runs from 30 June. This is the ordinary statutory interest rate (4% a year since 1 January 2026), not the higher commercial rate. If you wish, the calculator calculates that interest after the calculation.
The statutory increase under Article 7:625 of the Dutch Civil Code for late payment of wages does not apply: the transition payment is not wage fixed in money within the meaning of that provision. Cantonal courts therefore reject an increase on the transition payment (for example District Court of The Hague, 22 March 2024, ECLI:NL:RBDHA:2024:5371).
For extrajudicial collection costs, the fixed scale does not apply automatically: the Besluit vergoeding voor buitengerechtelijke incassokosten (Decree on compensation for extrajudicial collection costs) was written for claims against consumers and between businesses. What remains is the general standard of Article 6:96(2)(c) of the Dutch Civil Code: reasonable costs. In proceedings before the cantonal court these are assessed as legal costs.
Frequently asked questions
What is the formula for the Dutch transition payment?
How much is the transition payment after 10 years?
What is the maximum transition payment in 2026?
From which day does the transition payment accrue?
Does a lease car count towards the transition payment?
Is an employee entitled to a transition payment after resigning?
Am I entitled to a transition payment under a settlement agreement?
What if a fixed-term contract simply expires?
Is the transition payment taxable?
When is statutory interest due on the transition payment?
What if the employer calculated the transition payment too low?
Is this calculation legal advice?
Related Dutch employment law resources
- Transition payment under Dutch law: full legal explanation
- How to calculate the Dutch severance step by step
- Dismissal procedures in the Netherlands (UWV / kantonrechter)
- Dutch settlement agreement (vaststellingsovereenkomst): what to negotiate
- Fair compensation (billijke vergoeding) in addition to severance
- Find a Dutch employment lawyer to verify your severance
- Dutch employment law glossary: 136 key terms