Employer NI Calculator 2026/27
The full cost of employing someone in the UK in 2026/27 — 15% employer NI less the £10,500 Employment Allowance, auto-enrolment pension, apprenticeship levy, other costs, on-cost percentage, cost per hour worked and how much the employee takes home.
| Employer National Insurance | — |
|---|---|
| Employment Allowance | — |
| Employer pension | — |
| Apprenticeship levy | — |
| Other costs | — |
| Total cost of employment | — |
| On-cost percentage | — |
| Cost per hour worked | — |
| What the employee takes home | — |
| Tax wedge | — |
In short
Employing someone in the UK in 2026/27 costs the salary plus 15% employer National Insurance on everything above £5,000 (less the £10,500 Employment Allowance for eligible employers), at least 3% employer pension on qualifying earnings between £6,240 and £50,270, the apprenticeship levy for pay bills over £3 million, and benefits — typically 15–25% on top of salary for statutory items and 30–50% with benefits, space and equipment. No employer NI is due on under-21s or apprentices under 25 up to £50,270.
Who this is for: UK employers and founders budgeting a hire.
What an employee costs a UK employer in 2026/27
- Employer NI: 15% of everything above £5,000 a year — £5,250 on a £40,000 salary. The £10,500 Employment Allowance wipes out the first £10,500 of an eligible employer's total bill (one or two employees' worth).
- Pension: auto-enrolment minimum of 3% employer (8% total) on qualifying earnings between £6,240 and £50,270; many employers pay 5–10% on full salary.
- Apprenticeship levy: 0.5% of the pay bill above £3 million (£15,000 allowance).
- Statutory extras: 5.6 weeks' paid holiday (built into the hourly cost), statutory sick pay from day one, maternity/paternity pay (largely reclaimable by small employers), and from 2026 day-one unfair-dismissal and sick-pay rights under the Employment Rights Act.
- Typical on-cost: 15–25% for pay and statutory items alone; 30–50% once benefits, space and equipment are included.
See also: UK Take-Home Pay Calculator 2026/27, UK Holiday Entitlement Calculator.
Assumptions
- Employer NI = 15% × (salary − £5,000), nil for under-21s up to £50,270; Employment Allowance £10,500 shared equally across headcount.
- Pension = % × qualifying earnings (£6,240–£50,270) or full salary; levy = 0.5% × (pay bill − £15,000 allowance) ÷ headcount when pay bill > £3m.
- Take-home = salary − income tax − employee NI (rUK).
Worked example
Employer NI 15% × £35,000 = £5,250, less a £2,100 share of the Employment Allowance = £3,150. Pension 3% × £33,760 of qualifying earnings = £1,013. Total cost £46,163 — a 15.4% on-cost, or £23.67 per hour worked. The employee takes home about £32,320 after £5,486 of income tax and £2,194 of NI, so 30.0% of the employer's spend goes to HMRC and the pension rather than into pay.
Frequently asked questions
How much employer NI do I pay in 2026/27?
15% of each employee's earnings above £5,000 a year (£96 a week), reduced by the £10,500 Employment Allowance if you qualify. Nothing on under-21s and apprentices under 25 up to £50,270.
Who can claim the Employment Allowance?
Businesses and charities paying employer Class 1 NI — but not companies whose only employee is a director, nor public bodies or employers doing mainly public work.
What is the minimum employer pension contribution?
3% of qualifying earnings (£6,240–£50,270) under auto-enrolment, with the employee paying 5% including tax relief; the government has signalled increases later this decade.
What is the true cost of hiring?
Salary plus roughly 15–25% in NI and pension, plus benefits, holiday cover, equipment and space — budget 1.3–1.5 times salary for a full-time office hire.
Is employer NI due on bonuses and benefits?
Yes — Class 1 NI on cash pay including bonuses and Class 1A (15%) on benefits in kind such as company cars and medical insurance.
Can I claim the Employment Allowance with one employee?
Yes, as long as that employee is not the sole director; a company with one director and one other employee above the threshold qualifies.
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