What Do Your Employees Actually Cost? Employer NIC Calculator for 2026/27
A £30,000 salary does not cost £30,000. Employer National Insurance at 15% and minimum pension contributions add thousands to every employee. Since April 2025, the employer NIC rate increased from 13.8% to 15% and the threshold dropped from £9,100 to £5,000. This tool shows the true employment cost for each member of your team.
How to use
Add employees with their annual salary and NIC category. The tool calculates employer NIC, pension contributions (3% minimum on qualifying earnings), and shows the total employment cost. Toggle the Employment Allowance on or off. Different NIC categories (under 21, apprentice under 25, veteran, over State Pension age) have different rates.
Frequently Asked Questions
What NIC category should I use?
Category A is the standard for most employees. Category C applies to employees over State Pension age (no employee NIC but employer NIC still applies). Category H is for apprentices under 25, Category M for employees under 21, and Category V for veterans in their first 12 months of civilian employment. Categories H, M and V benefit from 0% employer NIC up to £50,270.
What is the Employment Allowance?
The Employment Allowance lets eligible employers reduce their employer NIC bill by up to £10,500 per year. Most employers qualify. However, single-director companies with no other employees cannot claim it. There is no longer an upper eligibility cap.
Why did employer NIC increase so much?
The Autumn Budget 2024 increased employer NIC from 13.8% to 15% and reduced the threshold from £9,100 to £5,000, effective April 2025. These rates continue into 2026/27. The combined effect increases the cost of a £30,000 employee by approximately £865 per year.
Is employer NIC tax-deductible?
Yes. Employer NIC is an allowable business expense and reduces your taxable profit for Corporation Tax or Income Tax purposes. The net cost is therefore lower than the headline NIC figure.
Need help with your tax planning?
Book a free 30-minute discovery call and we will give you straightforward, jargon-free advice on your specific situation.
Book a Free Discovery Call© Imperial Consulting Limited, trading as Grosvenor.Solutions. This tool is for illustrative and educational purposes only. It is not tax advice. Your circumstances may differ. Always consult a qualified professional before making tax decisions. Calculated using 2026/27 HMRC published rates for England, Wales and Northern Ireland.