The 1940 edition of the KRs states:
Para 390 (ix) Free after .... years' service. (the .... indicating the specific number of years)
(a) A free discharge maybe granted to a re-engaged soldier after at least 12 years, or under Special War Office instructions.
I believe service during time of war counted as double, so he may have been discharged after 6, or as part of the demobilisation (as per WO instructions).