What an employee actually costs you
Salary is the part everyone quotes. This adds the parts that only appear in the payroll run.
What the contract says — before any deductions
The percentage your scheme puts in — check the scheme, this is not a fixed figure
Only needed to check the Apprenticeship Levy, which starts above £3,000,000
Total cost of employment
£34,650.00
£2,887.50 per month · £4,650.00 on top of the salary
For every £100 of salary
£15.50
Employer NI as % of salary
12.5%
| Gross salary | £30,000.00 |
|---|---|
| Employer National Insurance | £3,750.00 |
| Employer pension | £900.00 |
| Total cost | £34,650.00 |
The link carries your figures so anyone opening it sees the same calculation. Nothing is sent anywhere.
Figures for the 2026/27 UK tax year. Rates last checked against HMRC on 28 August 2026. See every source.
How to work out the cost of a hire
Every other calculator on this site answers a question asked by the person being paid. This one answers the question asked by the person paying: what does this hire actually cost. Employer National Insurance never appears on a payslip, so it is easy to leave out of a budget and awkward to discover later — and it is charged only on the part of the salary above the secondary threshold, which is why the effective rate is always lower than the headline percentage. The figure most useful for planning is not the total but the on-cost: how much extra each £100 of salary costs, so you can multiply it across a team rather than running each person separately.
- 1Enter the gross salary you intend to offer.
- 2Set the employer pension percentage your scheme actually pays — this is not a fixed national figure, so check the scheme.
- 3Tick Employment Allowance only if you genuinely qualify; a sole director with no other employee above the secondary threshold does not.
- 4Read the on-cost per £100 and multiply it across the rest of the team.
FAQ
Why is employer National Insurance lower than the headline rate?
Because it is charged only on the portion of pay above the secondary threshold, not on the whole salary. The lower the salary, the larger the share that sits below that threshold and escapes entirely — so the effective rate as a percentage of salary rises as pay rises, even though the rate itself never changes.
Can my company claim the Employment Allowance?
Not if the only person paid above the secondary threshold is a single director. That rules out most one-person limited companies, which is why the box is unticked by default here. Claiming it when you do not qualify creates an underpayment that HMRC will come back for, so check before ticking.
Does the Apprenticeship Levy apply to me?
Only once the total pay bill for the business passes the point where the levy allowance runs out. The optional pay bill field exists purely to answer that question — most small employers can leave it blank, and the calculator will show no levy.
What is not included?
Statutory payments such as sick or maternity pay, holiday cover, recruitment costs, equipment, insurance and apprenticeship funding are all outside this figure. It also assumes a steady salary across the whole tax year and covers England, Wales and Northern Ireland only. Treat it as the payroll floor of a hire rather than the full cost of one.