Employer National Insurance Calculator
The Employer National Insurance calculator calculates how much employer National Insurance a business pays on an employee's salary. The Employer National Insurance calculator computes the employer's National Insurance contributions from the gross annual salary, the employee's National Insurance category letter, and the tax year. The calculator returns the annual and monthly employer NI costs for each employee from these inputs. The calculation applies the secondary threshold and the 15% employer NI rate, subtracting the threshold from the gross pay and multiplying the remainder by the rate. The Employer National Insurance calculator adjusts the result for the employee's category letter and the selected tax year.
The Employee
Employer National Insurance
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Enter a salary to see the employer NI.
Estimates only — verify with HMRC or a qualified accountant.
Employer National Insurance is a payroll tax that employers pay on their employees' earnings above the secondary threshold. For the 2026/27 tax year, the standard employer NI rate is 15% on earnings above £5,000 annually. Employer National Insurance funds state benefits, the NHS, and the State Pension. Employers must pay employer National Insurance for employees earning above the threshold, with exemptions for under-21s, apprentices under 25, and qualifying veterans. The category letters, such as A for standard employees and H for apprentices under 25, set the applicable rates and thresholds.
Employer National Insurance differs from employee NI in who pays, the rate applied, and the threshold used. Employers pay 15% on earnings above the £5,000 threshold, while employee NI is deducted from pay at varying rates above different thresholds. Employers can reduce their NI bill through the Employment Allowance or salary sacrifice schemes. Employer NI, alongside workplace pension costs, represents an additional per-employee on-cost. The previous employer NI rate was 13.8% with a higher secondary threshold, so current-year figures produce accurate calculations.
What is employer NI contributions calculator?
The employer NI contributions calculator is an online tool that calculates the employer National Insurance due on a salary. The employer NI contributions calculator requires three inputs: the gross annual salary of the employee, the employee's NI category letter (such as A for standard employees, H for apprentices under 25, or M for employees under 21), and the tax year for the calculation, such as 2026/27.
The employer NI contributions calculator outputs the annual and monthly employer NI cost for that specific employee. Businesses use the employer NI contributions calculator to forecast payroll liabilities and plan finances. The employer NI contributions calculator offers annual and monthly breakdowns, which support budgeting and employment cost forecasting across the tax year.
How does employer NI calculator works?
The employer NI calculator applies the secondary threshold and the 15% employer NI rate to the salary you enter. The employer NI calculator performs a direct calculation: subtract the secondary threshold from the gross pay, then multiply the remainder by the employer NI rate. For example, on a salary of £30,000, the employer NI calculator deducts the £5,000 secondary threshold to leave £25,000, then multiplies £25,000 by 15%, producing an employer NI liability of £3,750 per year.
The employer NI calculator adjusts for the employee category letter and the selected tax year. Different category letters, such as A for standard employees, H for apprentices under 25, or M for employees under 21, apply varying thresholds and rates. The employer NI calculator accounts for these variations to deliver an accurate result tailored to the circumstances you input.
How does employer NI work for part-time employees?
Employer National Insurance applies to part-time employees in the same way it applies to full-time employees, but only on earnings above the secondary threshold. For the 2026/27 tax year, the secondary threshold is £5,000 annually or £417 monthly. Part-time employees who earn below the secondary threshold incur no employer NI liability.
Employer National Insurance for part-time workers depends on earnings, not the number of hours worked. An employee who works fewer hours but earns above the secondary threshold still triggers employer NI at the standard rate of 15% on the excess amount. Employer National Insurance contributions track income levels rather than employment type.
How much NI and tax will I pay?
On a £30,000 salary
£3,750
employer National Insurance per year · £312.50 per month
On a typical salary of £30,000, your business will pay £3,750 in employer National Insurance per year. Employer National Insurance applies the 15% rate to the earnings above the secondary threshold of £5,000. The calculation subtracts the threshold from the gross salary and multiplies the remainder by the 15% rate, producing a monthly cost of £312.50 for the employer.
Employer National Insurance is separate from the employee's own National Insurance and income tax obligations. The employee's contributions are deducted through the PAYE system, while employer National Insurance is an additional expense borne by the business. For example, on a £30,000 salary, the total employment cost to the employer, including NI, reaches £33,750.
Is employer NIC calculator accurate?
Yes, the employer NIC calculator is accurate when the salary, category letter, and tax year are entered correctly. The employer NIC calculator uses HMRC's current rates and thresholds to produce precise employer National Insurance figures for the selected tax year. The employer NIC calculator does not account for the Employment Allowance and salary sacrifice adjustments. The Employment Allowance can reduce an eligible employer's annual NI liability by up to £10,500 for the 2025/26 and 2026/27 tax years. Salary sacrifice arrangements lower the gross pay that employer NI is charged on by swapping salary for benefits such as pension contributions. Without these reductions, the employer NIC calculator shows the full employer NI liability before any available reliefs or savings.
What is the formula to calculate Employer National Insurance?
The formula to calculate Employer National Insurance is: employer NI equals gross pay minus the secondary threshold, multiplied by 15%. The formula applies to earnings in the 2026/27 tax year for employees in standard NI categories.
Formula
Employer NI = (Gross pay − £5,000) × 15%
Gross Pay
Gross pay is the employee's total salary before any deductions, including basic pay, bonuses, overtime, and commissions.
Secondary Threshold
The secondary threshold is the annual earnings level below which no employer NI is due. For 2026/27, the secondary threshold is £5,000 annually, or approximately £417 monthly.
Employer NI Rate
The employer NI rate is the percentage charged on earnings above the secondary threshold, set at 15% for the 2026/27 tax year.
For example, on a gross annual salary of £30,000, the calculation runs as follows: subtract the secondary threshold (£30,000 - £5,000 = £25,000), then multiply the remainder by the 15% employer NI rate (£25,000 × 0.15 = £3,750). The employer pays £3,750 in National Insurance contributions annually for this employee, or £312.50 per month.
What is Class 1 employer National Insurance?
Class 1 employer National Insurance is the contribution employers pay on employee earnings above the secondary threshold. Class 1 employer National Insurance is a mandatory payment made by employers, not deducted from employees' wages, and applies to all employees earning more than the set threshold. For the 2026/27 tax year, Class 1 employer National Insurance is 15% on earnings exceeding the annual secondary threshold of £5,000. Employers pay Class 1 employer National Insurance through the PAYE payroll system and submit it to HMRC monthly, alongside other tax obligations.
What is Secondary Threshold and the 15% Employer NI Rate?
The secondary threshold is the earnings level above which employers must pay National Insurance contributions on an employee's pay. For the 2026/27 tax year, the secondary threshold is £5,000 per year, approximately £417 per month or £96 per week. Employers pay a 15% employer NI rate on all earnings above the secondary threshold. The current threshold and rate differ from previous years, when the secondary threshold was higher at £9,100 annually and the rate was lower at 13.8%. Earnings below the £5,000 threshold incur no employer National Insurance costs, so part-time or low-paid employees whose earnings fall below this level generate no employer NI liability. All earnings above the secondary threshold attract the full 15% rate, with no upper earnings limit.
What Is Employer National Insurance?
Employer National Insurance is a payroll tax that employers pay on their employees' earnings above a certain threshold. Employer National Insurance is paid in addition to the salary and funds public services such as the National Health Service (NHS) and the State Pension. Employer National Insurance is a mandatory business expense that supports the UK's social security system, including state benefits and contributory services. Employers calculate and remit employer National Insurance through the Pay As You Earn (PAYE) system, submitting the correct amounts alongside other payroll liabilities.
How Does Employer National Insurance Work?
Employers pay National Insurance on each employee's earnings above the secondary threshold, collected through the PAYE (Pay As You Earn) system. The PAYE system deducts employer National Insurance contributions automatically as part of regular payroll operations. Employers report all employee earnings and corresponding National Insurance contributions to HMRC using Real Time Information (RTI). RTI reporting occurs each payroll cycle, so employers make accurate monthly payments to HMRC. The monthly payments include employer National Insurance liabilities, alongside employee income tax and National Insurance deductions. Employer National Insurance through PAYE ensures compliance with legal obligations and efficient tax collection.
What Are the Employer National Insurance Category Letters?
Employer National Insurance category letters are codes that set the employer NI rate for each employee. Employer National Insurance category letters determine how much employer National Insurance is due based on the employee's circumstances. The Employer National Insurance category letters are listed below.
Category A is the standard category for most employees, applying the full 15% employer NI rate above the secondary threshold.
Category H applies to apprentices under 25, exempting them from employer NI on earnings up to £50,270.
Category M covers employees under 21, who are exempt from employer NI up to the £50,270 threshold.
Category Z applies to employees with deferred National Insurance, such as older workers or those with multiple jobs.
Categories B and C relate to set groups, such as married women and widows with reduced-rate certificates, though these categories are rare today.
Employer National Insurance category letters ensure that the correct employer National Insurance contributions are calculated, reflecting any applicable exemptions or reduced rates.
Employer National Insurance Rates and Thresholds for 2026/27
The Employer National Insurance rates and thresholds for the 2026/27 tax year define the contributions employers must make based on employee earnings. The Employer National Insurance rates and thresholds for the 2026/27 tax year are listed below.
| Threshold or Rate | Weekly Value | Annual Value | Applies To |
|---|---|---|---|
| Secondary Threshold | £96.15 | £5,000 | All employees - employer NI is charged on earnings above this level |
| Employer NI Rate | 15% | 15% | Earnings above the Secondary Threshold for standard employees (Category A) |
| Upper Secondary Threshold (Apprentices under 25) | £967.31 | £50,270 | Apprentices under 25 pay 0% employer NI up to this threshold, then 15% above |
| Upper Secondary Threshold (Employees under 21) | £967.31 | £50,270 | Employees under 21 pay 0% employer NI up to this threshold, then 15% above |
| Class 1A NI Rate (Benefits in Kind) | 15% | 15% | Applies to employee benefits such as company cars and private medical insurance, paid annually |
| Class 1B NI Rate (PAYE Settlement Agreement) | 15% | 15% | Applies to tax and NI on minor benefits settled through a PSA, paid annually |
| Employment Allowance | N/A | £10,500 | Annual reduction available to eligible employers to offset their total employer NI bill |
Employer National Insurance rates and thresholds set employer contributions by employee earnings and category, with set exemptions and allowances for different workforce segments.
What is the purpose of Employer National Insurance?
Employer National Insurance funds state benefits, the NHS, and the State Pension. Employer National Insurance contributions support the UK's social security system, so public services and welfare programs receive financial support. Employer National Insurance payments on earnings above the secondary threshold maintain these services for the entire population.
What are employer National Insurance contributions?
Employer National Insurance contributions are the payments a business makes to HMRC on its employees' pay. Employer National Insurance contributions are an employer cost separate from the employee's own National Insurance contributions. Employers calculate and remit employer National Insurance contributions based on each employee's earnings above the secondary threshold. Employer National Insurance contributions fund state benefits, such as the NHS and the State Pension. Employers bear employer National Insurance contributions as an additional employment expense, paid on top of the salary rather than deducted from it.
Why Do Employers Pay National Insurance?
Employers pay National Insurance because the law requires a contribution toward state benefits for every employee earning above the threshold. The legal obligation directs businesses to fund public services such as the NHS and State Pension. National Insurance contributions are collected through the PAYE system and paid monthly to HMRC. Employers pay a 15% rate on earnings above the £5,000 annual secondary threshold for the 2026/27 tax year. The requirement applies to any business with employees whose earnings exceed the threshold, making employer National Insurance a core employment cost alongside salary and workplace pension contributions.
What are the benefits of paying National Insurance?
Paying National Insurance funds several public services and benefits in the UK. National Insurance contributions support the State Pension, which provides retirement income for eligible individuals. National Insurance funds the National Health Service (NHS), providing access to healthcare services free at the point of use. National Insurance finances contributory benefits such as Jobseeker's Allowance, Employment and Support Allowance, and Maternity Allowance, available to those who have made sufficient contributions.
Who Has to Pay Employer National Insurance?
Any employer with staff earning above the secondary threshold must pay employer National Insurance. For the 2026/27 tax year, the secondary threshold is £5,000 annually (£417 monthly), so employer NI contributions at the 15% rate become due on earnings that exceed this amount. The obligation applies to all qualifying employers in the UK who have employees on their payroll. Employer National Insurance is part of the PAYE (Pay As You Earn) system, where employers calculate and remit the contributions to HMRC monthly alongside income tax deductions. Employers pay NI on each employee's earnings above the secondary threshold, regardless of business size, though certain reliefs and allowances may reduce the overall liability for eligible employers.
Who Is Exempt from Paying Employer National Insurance?
Certain employees are exempt from employer National Insurance contributions under set conditions. The exempt groups are listed below.
- Employees earning below the secondary threshold of £5,000 annually.
- Employees under the age of 21.
- Apprentices under the age of 25.
- Qualifying veterans during their first year of employment.
For these exempt groups, employer National Insurance is not payable on earnings up to the Upper Secondary Threshold of £50,270 per year. The relief reduces the financial burden on employers and encourages the hiring of young workers and veterans.
How Much Employer NI Do You Pay Per Employee?
Employer National Insurance on an average salary applies the 15% rate above the secondary threshold. For example, on an employee earning £30,000 annually, the employer pays National Insurance on £25,000, producing a contribution of £3,750. The calculation subtracts the £5,000 threshold from the gross salary and applies the 15% rate to the remaining balance.
The per-employee figure increases with salary, because employer NI is charged only on earnings above the secondary threshold. Higher salaries produce larger employer NI contributions, an additional cost to employers beyond the employee's gross pay.
Employer NI on a £12,570 Salary
For the 2026/27 tax year, employer National Insurance on a £12,570 salary is £1,135.50. The calculation subtracts the secondary threshold of £5,000 from the gross salary to leave £7,570 of taxable earnings. Employer National Insurance multiplies £7,570 by the 15% employer NI rate to determine the total contribution. The £1,135.50 figure represents the employer's cost for National Insurance on this salary level, separate from any employee contributions or income tax deductions.
Employer National Insurance Versus Employee National Insurance
Employer National Insurance and employee National Insurance serve distinct roles within the UK's payroll system, each with its own characteristics. The comparison of their features is listed below.
| Feature | Employer National Insurance | Employee National Insurance |
|---|---|---|
| Who pays | The employer pays on top of the employee's salary | The employee pays, deducted from their gross pay |
| Rate | 15% for 2026/27 | Varies by earnings band: 0% up to primary threshold, 8% between primary threshold and upper earnings limit, 2% above upper earnings limit |
| Threshold | Secondary threshold of £5,000 annually (£417 monthly) for 2026/27 | Primary threshold applies to employee contributions |
| How it is collected | Paid by the employer directly to HMRC through PAYE, reported and remitted monthly | Deducted from employee wages by the employer and paid to HMRC through PAYE |
| What it funds | State benefits, NHS, and State Pension | State Pension, NHS, and contributory benefits; builds the employee's own NI record for future entitlements |
Key Differences
Employer National Insurance and employee National Insurance are two separate contributions collected through the PAYE system but paid by different parties. Employer NI is a business cost paid on top of salary at 15% on earnings above the £5,000 secondary threshold for 2026/27, whereas employee NI is deducted from the worker's gross pay at progressive rates starting at 8% above the primary threshold.
The employer contribution does not appear on the employee's payslip as a deduction, because employer National Insurance is an additional employment cost. Both types of NI fund the same public services, the NHS, State Pension, and contributory benefits, but employee contributions also build the individual's NI record for future pension and benefit entitlement. The secondary threshold for employers (£5,000) is lower than the primary threshold for employees, so employers begin paying NI on lower earnings than employees do on their own pay.
How Can Employers Reduce Their National Insurance Bill?
Employers can reduce their National Insurance bill through the Employment Allowance and salary sacrifice schemes. The Employment Allowance and salary sacrifice schemes lower the overall cost of employer National Insurance contributions and are listed below.
Employment Allowance
The Employment Allowance reduces an eligible employer's National Insurance liability by up to £10,500 annually for the 2026/27 tax year. The Employment Allowance cuts the total contribution due to HMRC, a sizeable saving for qualifying businesses.
Salary Sacrifice
Salary sacrifice arrangements exchange a portion of an employee's gross salary for non-cash benefits such as pension contributions or childcare vouchers. Salary sacrifice lowers the pay subject to the 15% employer National Insurance rate, reducing the employer's NI bill.
The Employer National Insurance calculator can model each saving scenario, so employers compare the standard cost with the reduced cost after applying these reliefs.
Claiming the Employment Allowance
The Employment Allowance reduces an eligible employer's National Insurance bill by a fixed annual amount. For the 2026/27 tax year, the Employment Allowance lowers an employer's NI liability by up to £10,500. To claim the Employment Allowance, employers activate it through their payroll software. Claiming the Employment Allowance involves marking the Employment Allowance indicator on the relevant HMRC submission. Once claimed, the Employment Allowance applies automatically, reducing the monthly payments due to HMRC until the full annual amount is used.
What is the Employment Allowance for employer NI?
The Employment Allowance for employer National Insurance is £10,500 per tax year. The Employment Allowance reduces the amount of Class 1 employer National Insurance contributions owed to HM Revenue and Customs (HMRC).
Saving Employer NI Through Salary Sacrifice
Salary sacrifice reduces employer National Insurance liabilities. Salary sacrifice involves an employee agreeing to forgo part of their gross salary in exchange for non-cash benefits, such as higher pension contributions. Salary sacrifice lowers the employee's taxable salary, reducing the employer's NI contributions, which are calculated on earnings above the secondary threshold. For example, if an employee earning £40,000 sacrifices £3,000 for pension contributions, the employer's NI is calculated on £37,000, saving £450 annually at the 15% rate.
The benefits of salary sacrifice extend beyond immediate NI savings. Salary sacrifice can reduce overall payroll costs, because the employer's pension obligations are met while lowering exposure to NICs. Salary sacrifice works well alongside workplace pension schemes, maintaining compliance with pension rules while improving tax efficiency. Employers must ensure that salary sacrifice arrangements do not reduce an employee's pay below the National Minimum Wage, and certain benefits may still attract Class 1A NI. The employer NI calculator models potential savings, so businesses plan and manage their payroll expenses.
Employer NI Alongside Workplace Pension Costs
Employer National Insurance and minimum workplace pension contributions are both per-employee on-costs added to salary. Employer NI and workplace pension contributions form part of the overall employment expenses that businesses must budget for. Employer NI is charged at 15% on earnings above the secondary threshold, set at £5,000 for the 2026/27 tax year. For each employee, the employer calculates NI on the qualifying earnings exceeding the secondary threshold.
Workplace pension contributions, set at a minimum of 3% of qualifying earnings for the employer's share, increase the total cost of employing staff. Workplace pension contributions are mandatory for eligible employees and must be paid monthly to both HMRC and the respective pension scheme. Employer NI and pension contributions together drive payroll planning and budgeting.
Employers use the Workplace Pension Calculator to model the combined cost of NI and pension contributions. The Workplace Pension Calculator lets businesses anticipate the total on-cost burden when hiring or planning payroll, supporting compliance with statutory obligations and financial efficiency.
What Were the Previous Employer NI Rates and Thresholds?
The prior employer National Insurance rate was 13.8%, with a secondary threshold set at £9,100 annually. Before April 2025, employers paid 13.8% on employee earnings above the £9,100 threshold. From April 6, 2025, the rate increased to 15%, and the secondary threshold dropped to £5,000 annually. The change increased the employer NI liability for most businesses. For instance, an employee earning £30,000 would have incurred £2,883 in employer NI under the 2024/25 rates, but this amount rose to £3,750 under the 2026/27 rates, an increase of £867 per employee per year.
Employers should use current-year figures in the calculator to produce accurate payroll costs and budget forecasting. Historical rates support comparison and show how employer costs have evolved, but only the 2026/27 figures, the 15% rate and £5,000 threshold, deliver the correct liability for this tax year. Outdated rates underestimate the true cost per employee and cause cash flow surprises and compliance errors when submitting returns to HMRC.