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UK Employer Cost Calculator

Accurately estimate the total cost of employing staff in the UK — including employer National Insurance and auto-enrolment pension. Rates confirmed for both 2025/26 and 2026/27.

Tax years 2025/26 & 2026/27 Employer NI 15% Secondary threshold £5,000 Employment Allowance £10,500 Auto-enrolment pension

⚙️ Rate settings — 2025/26

2025/26 and 2026/27 — rates identical both years. Update each April.
15% — confirmed for both 2025/26 and 2026/27. Frozen until at least 2030/31.
£5,000 — confirmed for both 2025/26 and 2026/27. Frozen until at least 2030/31.
£10,500 — confirmed unchanged for 2026/27. Check eligibility with AWB.
£6,240 — confirmed unchanged for 2026/27 by DWP (December 2025).
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Employment Allowance (EA): From April 2025, the EA increased to £10,500 and the £100,000 eligibility cap was removed. This calculator shows the EA saving in the summary — but check with AWB whether your organisation is eligible. Sole directors with no other employees cannot claim EA.

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2025/26 & 2026/27 — rates confirmed identical: The employer NI rate is 15% and the secondary threshold is £5,000 for both years. Both thresholds are frozen until at least 2030/31. The Employment Allowance (£10,500) and pension LEL (£6,240) are also unchanged for 2026/27. Compared to 2024/25 (13.8%, £9,100 threshold), employer NI costs are approximately 22% higher — the most common cause of grant budget variances.

👥 Employee posts

Post / job title Contract hrs
(per week)		 Project hrs
(per week)		 Annual salary
(full-time £)		 Employer
pension %		 Weeks on
project		 Project
salary		 Employer
NI		 Employer
pension		 Total cost
of post
£40,000£5,250£1,013£46,263
£19,200£2,430£389£22,019
TOTALS £59,200 £7,680 £1,402 £68,282
£40,000
Salary
£5,250
Emp NI
£1,013
Pension
£46,263
TOTAL
£19,200
Salary
£2,430
Emp NI
£389
Pension
£22,019
TOTAL
Cost summary
£59,200
Total salary
£7,680
Employer NI
(before Employment Allowance)
£1,402
Employer pension
-£7,680
Est. EA saving
(if eligible)

🆕 Employment Allowance applies: Your organisation’s employer NI bill (£7,680) is below the £10,500 EA — you pay £0 employer NI if eligible. Check eligibility with AWB.

Total employer cost (salary + NI net of EA + pension)
£60,602

📝 Important notes & guidance

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2025/26 & 2026/27 rates (identical both years): Employer NI rate is 15% on earnings above £5,000/year. Both changes were announced in the Autumn Budget 2024. If your estimates were prepared before April 2025 using 13.8% and £9,100 threshold, actual costs will be approximately 22% higher.
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Employment Allowance: From April 2025, eligible employers can reduce their employer NI bill by up to £10,500/year. The previous £100,000 eligibility cap has been removed. However, this calculator cannot determine your eligibility — sole directors with no other employees cannot claim. Contact AWB to confirm eligibility before including EA in grant budgets.
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Auto-enrolment pension: Employer pension contributions are calculated on qualifying earnings above the lower earnings limit (£6,240 for 2025/26). The minimum employer contribution is 3% of qualifying earnings. Enter your actual employer contribution rate in the pension % column.
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Part-time / project-apportioned staff: Enter the employee’s full contract hours in column 2 and only their project hours in column 3. The calculator proportions salary, NI and pension correctly for the project. For example, a staff member working 32 of 40 hours on a project will have 80% of their employer costs attributed to the project.
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Apprenticeship Levy: Not included in this calculator. Applies only to employers with a total annual payroll bill over £3,000,000, at 0.5% on the bill above £3m. Contact AWB if your organisation may be in scope.
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This is an estimate only. Actual costs may vary depending on your organisation’s payroll structure, pension scheme, Employment Allowance eligibility, and any applicable NI reliefs (e.g. veterans, under-21s, apprentices). Always confirm with a qualified payroll professional before submitting grant budgets.

Need help with payroll or grant budgeting?

AWB works exclusively with charities and social purpose organisations. We manage payroll, prepare grant budgets, and make sure your employer cost calculations are always accurate and up to date.

Book a free consultation → Visit aw-b.org