Employer National Insurance Calculator 2026-27 Trending
Calculate employer NI contributions at the new 15% rate from April 2025, with the reduced £5,000 secondary threshold.
By Konstantin Iakovlev · Founder, Calks.uk
Last updated: · Verified against HMRC and GOV.UK 2026/27 rates
Quick Answer
Employer NI (Class 1 secondary) in 2026/27 is 15% on earnings above the £5,000 Secondary Threshold (down from £9,100 in 2024). Employment Allowance of £10,500 can reduce your annual bill if eligible.
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
From April 2025, employer National Insurance increased to 15% (up from 13.8%). The secondary threshold was reduced to £5,000 (down from £9,100), meaning employers now pay NI on a significantly larger portion of each employee's salary.
The Employment Allowance for 2026/27 is £10,500, which offsets your employer NI bill. Most businesses are eligible unless their total employer NI liability exceeded £100,000 in the previous tax year, or the company has a single director with no other employees.
This calculator shows the cost per employee and lets you estimate the impact of the April 2025 changes compared to the previous year's rates.
Why employer NI rose to 15% in April 2025. The Autumn 2024 Budget raised employer Class 1 NI from 13.8% to 15% AND cut the Secondary Threshold from £9,100 to £5,000. Combined, this adds ~£900 per employee earning £40,000+ in 2026/27 vs the previous regime. The Employment Allowance increased to £10,500 (from £5,000) to offset for very small employers — but it has a cliff edge at any employer Class 1 NI exceeding £100,000 in the previous tax year.
Employment Allowance: who qualifies and how much. Eligible employers can claim up to £10,500/year against their Class 1 employer NI bill (2026/27). Eligibility requires: (1) operating a trade or business (not public sector unless qualifying), (2) at least one employee other than just the director, OR two directors both earning above the Secondary Threshold. Sole-director companies cannot claim. From April 2020, employers with employer NI bill >£100,000 in previous tax year cannot claim.
Salary sacrifice — the win-win for employer and employee. When an employee sacrifices £1,000 of salary into pension/EV/cycle-to-work, the employer saves 15% NI (£150) AND avoids 0.5% Apprenticeship Levy (£5) for large payrolls. Many employers share part of this saving back as additional pension contribution. The employee saves income tax (20-45%) AND employee NI (8-2%). Combined tax savings can exceed 40-50% per £1 sacrificed.
Calculating total employment cost. True cost of an employee = gross salary + employer NI 15% (over £5,000) + pension auto-enrolment 3% min (on £6,240-£50,270) + Apprenticeship Levy 0.5% (if total pay >£3m) + holiday pay (already included in salary unless agency) + benefits (private health, life cover, gym, EV scheme). On a £40,000 salary, true cost is typically £45,000-£47,000. Use this calculator to budget the full overhead before hiring.
Example: Employee earning £30,000
- Earnings above secondary threshold: £30,000 − £5,000 = £25,000
- Employer NI at 15%: £25,000 × 0.15 = £3,750 per year
- Previous year (13.8%, £9,100 threshold): £2,884.20
- Annual increase: £865.80 per employee
Frequently Asked Questions
- Why employer NI jumped to 15% in April 2025.
- The 2024 Autumn Budget raised employer Class 1 NI from 13.8% to 15% AND cut the Secondary Threshold from £9,100 to £5,000. Combined effect: ~£900 additional employer NI per employee earning £40,000+ in 2026/27 vs previous regime. Employment Allowance increased to £10,500 (from £5,000) to offset for small employers. Largest single business tax rise in recent memory — political controversy continues.
- Employment Allowance — who qualifies?
- Up to £10,500/year against Class 1 employer NI bill (2026/27). Eligibility: (1) operating a trade or business (not public sector unless qualifying); (2) at least one employee other than the director, OR two directors both earning above Secondary Threshold; (3) employer NI bill under £100,000 in previous tax year. Sole-director companies cannot claim. Claim via PAYE through Employer Payment Summary — usually automatic if eligible.
- Salary sacrifice — employer NI win.
- When employees sacrifice into pension, employer saves 15% NI on the sacrificed amount, plus 0.5% Apprenticeship Levy if applicable. On £1,000 sacrificed: employer saves £155. Best-practice employers RETURN this saving as additional pension contribution (NI passback) — turning £1,000 sacrifice into £1,155 in pension. Costs employer nothing beyond admin. Ask HR if your scheme has NI passback.