Employer Cost Calculator 2025-26
Calculate the total cost of employing someone including salary, employer NI (15%), pension contributions and apprenticeship levy.
Last updated: April 2026 · Source: HMRC — Rates and thresholds for employers 2025/26
Disclaimer
This calculator is provided for informational purposes only and should not be considered as financial or tax advice. All calculations are performed locally in your browser — no personal data is collected or sent to our servers. Rates and thresholds are sourced from HMRC and GOV.UK and are updated for the current tax year. Always verify results with HMRC or consult a qualified professional before making financial decisions.
How It Works
The true cost of employing someone in the UK is significantly higher than their gross salary. Employers must pay employer National Insurance at 15% on earnings above £5,000, plus workplace pension contributions of at least 3% of qualifying earnings under auto-enrolment. These mandatory costs typically add 15-20% on top of the salary.
Additional statutory costs include the Apprenticeship Levy (0.5% of total payroll for employers with a pay bill over £3m), employer's liability insurance and workplace pension administration fees. Depending on the role, there may also be costs for recruitment, training, equipment and benefits.
This calculator totals all employer-side costs for a given salary level. It separates mandatory costs (employer NI, pension minimum) from optional costs you can add (private healthcare, bonus, training budget). The result shows the full loaded cost per employee.
Example: Employee on £35,000 salary
- Employer NI: (£35,000 − £5,000) × 15% = £4,500
- Employer pension (3%): £35,000 × 3% = £1,050
- Total statutory extras: £5,550
- Total cost to employer: £35,000 + £5,550 = £40,550
- Effective uplift: 15.9% above gross salary
Frequently Asked Questions
- What does the Employer Cost Calculator do?
- Calculate the total cost of employing someone including salary, employer NI (15%), pension contributions and apprenticeship levy. All calculations are performed in your browser using official UK rates and thresholds.
- Is this calculator based on 2025/26 rates?
- Yes. This calculator uses the current 2025/26 UK tax year rates for income tax, National Insurance and other deductions, effective from 6 April 2025.
- Does this include pension contributions?
- This calculator can factor in workplace pension contributions. Under auto-enrolment, the minimum is 8% total (5% employee + 3% employer) of qualifying earnings.