Employee cost calculator
Salary is only part of the cost of an employee. See the full annual and monthly cost once employer NI, pension and benefits are added.
Your total employee cost
Change the numbers, the results update instantly.
Employment Allowance may offset up to £10,500 of employer NI across your whole payroll each year, not netted off in this figure. Always take advice before acting.
How it works
Employer National Insurance is charged at 15% on salary above £5,000 a year. Add your employer pension contribution and any other benefits, and the true cost of an employee is usually noticeably higher than their headline salary. Many small employers can offset up to £10,500 a year of employer NI across their whole payroll using the Employment Allowance, shown here as a footnote rather than deducted, since eligibility varies. Our payroll service handles this calculation, along with auto-enrolment, for every client on our books.
Frequently asked questions
Why is the total higher than the salary I offered?
Because it includes employer National Insurance and pension contributions, which are additional costs to the business on top of the salary paid to the employee.
What is the Employment Allowance?
It lets eligible small employers reduce their employer NI bill by up to £10,500 a year, across their whole payroll, not per employee. It is not netted off in this calculator because eligibility depends on your specific circumstances.
Does this include employee income tax?
No, this tool shows the cost to you as the employer. Income tax and employee NI are deducted from the employee's gross salary and do not add to your cost.
Is auto-enrolment pension the minimum I should use?
The statutory minimum total contribution is 8%, with at least 3% from the employer, on qualifying earnings. Many employers offer more as part of their benefits package, and our payroll team can set up and run auto-enrolment for you.
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These results are a simplified illustration based on 2026/27 rates, not advice. Your real position depends on your full circumstances. For a personalised answer, book a free consultation.
Numbers looking complicated?
A calculator gives you an estimate. A free call gives you a plan. Book one and we'll work through your actual situation.