Employer's National Insurance calculator (UK)

How employer's National Insurance is worked out

• The rate: 15% of an employee's pay above the secondary threshold. There is no upper limit, so it keeps applying on every pound of salary.
• The threshold: £5,000 a year per employee. Pay someone £5,000 or less and there is no employer NI at all. Pay them £5,001 and you owe 15p.
• The sum: (gross salary − £5,000) × 15%. On £30,000 that is £25,000 × 15% = £3,750. On £50,000 it is £45,000 × 15% = £6,750.
• It is per employee, then added up: the threshold is applied to each person separately, so five part timers on £10,000 cost less NI than one person on £50,000.
• Then the allowance comes off the total: the Employment Allowance is deducted from the whole payroll's employer NI, not from each employee's.

Tax year 2026/27. Rates last checked: 15 July 2026. Employer NI rate 15%, secondary threshold £5,000, Employment Allowance £10,500.

What the Employment Allowance actually does

The Employment Allowance is a discount on your employer Class 1 NI bill, worth up to £10,500 for the year. Two things about it catch people out.

First, it is per business per year, not per employee. Hire your fifth member of staff and the allowance does not go up. It is a fixed pot that gets used up faster as the payroll grows, and once it is gone every extra pound of salary above £5,000 costs you a real 15p in NI.

Second, not everyone can claim it. A limited company where the only person on the payroll is a single director cannot claim. There are also rules for connected companies, where a group only gets one allowance between them, and for work that is mostly for the public sector. The toggle in the calculator is there because guessing this wrong changes the answer by thousands. Check your own position on gov.uk before you rely on it.

The allowance is also claimed through your payroll software, month by month, until it is used up. It is not a refund at year end, so if you never tick the box you simply never get it.

What does an employee actually cost on top of salary?

Salary is the number in the job advert. The cost to you is salary plus employer NI plus your employer pension contribution, and that is before anything else. On a £30,000 salary with the allowance already used up and a 3% employer pension, that is £3,750 of NI and £900 of pension, so £34,650 a year. Call it 15% on top.

The calculator stops there because those are the numbers I can source. The things it does not include are still real: recruitment fees, a laptop and a phone, software licences per seat, training, employer's liability insurance, cover while they are on holiday or off sick, and the management time that goes into all of it. If you are building a budget, take the total from this tool as your floor, not your forecast.

The one number worth arguing about internally is the marginal one. If you still have Employment Allowance headroom, the next hire may add no NI at all this year. Once the headroom is gone, the same hire costs you the full 15%. That difference is exactly why the extra hire box is on the calculator.

How much employer's NI do I pay on a £30,000 salary?

£3,750 for 2026/27. The sum is (£30,000 − £5,000) × 15%. If your business can still claim the Employment Allowance and has not used it on other staff, some or all of that £3,750 is covered by the allowance instead.

What is the secondary threshold for employer NI?

£5,000 a year for 2026/27. It is the point at which employer National Insurance starts on an employee's pay. Anything you pay below it carries no employer NI, and the threshold applies to each employee separately.

Is the Employment Allowance per employee or per business?

Per business, per tax year. One pot of up to £10,500 shared across your whole payroll. Connected companies in a group have to share a single allowance between them, and a company whose only employee is a sole director cannot claim it at all.

Do I pay employer NI on staff earning under £5,000?

No. If an employee's total pay for the year is at or below the £5,000 secondary threshold, there is no employer National Insurance on it. You may still have other payroll duties for them, including auto enrolment assessment and reporting the pay to HMRC.

Are there employees I pay no employer NI on?

Yes. There are zero rate categories including employees under 21, apprentices under 25, qualifying veterans and staff in freeports or investment zones. For those employees the employer rate is 0% up to a separate upper secondary threshold, and only the pay above that threshold attracts the 15%. This calculator uses the standard category, so for those staff it will overstate your bill. Check the current upper secondary thresholds on gov.uk before you budget on it.

Does employer NI apply to bonuses and overtime?

Yes. Employer National Insurance applies to earnings, which includes bonuses, commission, overtime and most taxable benefits. This calculator works on annual gross salary, so add any regular bonus into the salary figure if you want the full picture.

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