Employer NI Calculator
Find the true cost of employing someone in the UK. See employer National Insurance at 13.8% and compare it to the employee's actual take-home pay.
Employee details
Most small/medium employers qualify. Not available if you're a single-director company with no other employees.
How employer NI works in 2026/27.
Employer National Insurance is a separate taxthat employers pay on top of an employee's gross salary. It does notcome out of the employee's pay — it's an additional cost to the business.
2026/27 employer NI rates
Example: On a £35,000 salary, employer NI is 13.8% × (£35,000 − £5,000) = £4,140 per year. The true cost to employ that person is £39,140 — before pension contributions.
Why does this matter?
- Budgeting: Employer NI is often 10–14% of the salary cost. Forgetting it can blow a hiring budget.
- Contract negotiations: When comparing a permanent role vs. a contractor rate, factor in employer NI — a £50,000 salary costs ~£56,200+ to the employer.
- Salary sacrifice: If employees sacrifice salary into pension, the employer saves NI on the sacrificed amount too. Some employers pass this saving back to employees.
Employer NI questions answered.
How much employer NI do I pay on a salary in 2026/27?
Employers pay 13.8% National Insurance on employee earnings above the Secondary Threshold of £5,000 per year (£417/month) in 2026/27. There is no upper limit — employer NI applies to all earnings above the threshold.
What is the Employment Allowance?
The Employment Allowance for 2026/27 is £10,500. It reduces your employer NI bill by up to £10,500 per year. Most small and medium employers qualify, but you cannot claim it if you're a single-director company with no other employees, or if your employer NI bill was £100,000+ in the previous tax year.
Is employer NI deducted from the employee's pay?
No. Employer NI is an additional cost on top of the employee's gross salary — it does not reduce the employee's take-home pay. It is a separate tax that the employer pays directly to HMRC.
How does employer NI affect contractor rates?
When comparing a contractor day rate to a permanent salary, remember the employer also pays 13.8% NI on top of the salary. A £50,000 salary actually costs the employer around £56,200 after employer NI (before Employment Allowance). Contractors should factor this in when setting rates.
Does employer NI apply to pension contributions?
No. Employer pension contributions are exempt from employer NI. This is one reason salary sacrifice pension arrangements are popular — they reduce the employer's NI bill as well as the employee's tax and NI.