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Free UK HR calculator

Employee cost calculator

Estimate annual salary, employer National Insurance, the pension basis you choose and other known costs for one UK employee.

  • Free to use
  • No signup
  • 2026/27 statutory rates
Use the calculator

Estimate the annual cost of an employee

Choose the pension basis explicitly, then add only the annual costs you can support.
Employer pension to include

Automatic enrolment usually applies from age 22 to State Pension age when annual earnings reach £10,000. The minimum contribution is calculated on qualifying earnings from £6,240 to £50,270.

£36,822.80a year: 1.15× salary (£4,050 employer NI, £772.80 pension)

The working

  1. Employer NI = (£32,000 − £5,000 threshold) × 15% = £4,050
  2. Qualifying earnings = £32,000 capped band − £6,240 = £25,760
  3. Employer pension = £25,760 × 3% = £772.80
  4. Total = £32,000 + £4,050 + £772.80 = £36,822.80 (1.15× salary)

Worth knowing

  • Employment Allowance can cut up to £10,500 a year off employer NI, but it is per employer, not per employee. If you qualify and this is an early hire, your real NI bill may be lower.
  • Employer NI assumes standard category A and even annual pay. A different NI category, uneven pay or another relief changes the payroll result.
  • You selected the 3% statutory minimum on qualifying earnings from £6,240 to £50,270. Automatic enrolment usually applies from age 22 to State Pension age at earnings of at least £10,000; an opted-in worker can also require an employer contribution.
  • The estimate includes salary, employer NI, the pension basis selected and any other costs you enter. It leaves out office space, equipment refresh, management time and recruitment unless you add known amounts.

Basis: Employer NI and pension inputs use the 2026/27 rates reviewed 2026-08-28. Automatic enrolment usually applies from age 22 to State Pension age at £10,000 annual earnings; qualifying earnings run from £6,240 to £50,270.

GOV.UK employer NI ratesGOV.UK workplace pension contributionsThe Pensions Regulator thresholds
The method

What goes into the total

Each part of the estimate comes from a visible input or a dated statutory rate.
  1. 1

    Start with gross salary

    Use annual gross pay before employee tax, National Insurance or pension deductions.

  2. 2

    Add employer NI and pension

    Employer NI uses the standard category A, even-pay assumption. Pension is included only on the basis you select.

  3. 3

    Add costs you know

    Enter benefits, equipment or training when you have a real annual figure. The calculator does not invent an overhead percentage.

Worked example

Worked example: a £32,000 salary

The employer selects the statutory 3% contribution on qualifying earnings and enters no other costs.

Inputs

  • £32,000 gross salary
  • Standard category A NI
  • Statutory minimum pension
  • No other costs

Working

  1. Employer NI = (£32,000 − £5,000 threshold) × 15% = £4,050
  2. Qualifying earnings = £32,000 capped band − £6,240 = £25,760
  3. Employer pension = £25,760 × 3% = £772.80
  4. Total = £32,000 + £4,050 + £772.80 = £36,822.80 (1.15× salary)

The estimated annual employer cost is £36,822.80.

Use it with context

A planning figure, not a payroll run

Use this for a clear hiring estimate. Payroll software or your provider remains the source for the final pay-period calculation.

This calculator covers

  • Gross annual salary
  • Standard category A employer NI on even annual pay
  • Statutory, custom or zero employer pension selection
  • Other annual costs you choose to enter

Check the full guidance for

  • Different NI categories or uneven pay
  • Scheme-specific pensionable pay and salary sacrifice
  • Employment Allowance across the whole employer
  • Payroll deductions, benefits tax and HMRC submissions
From calculation to record

Keep the agreed terms ready for payroll

HollyHR keeps salary, working pattern and employment documents with the person record, ready for a controlled payroll hand-off.

See people records in HollyHR
Questions

About the employee cost calculator

How much does an employee cost above salary?

It depends on salary, employer NI, pension status, scheme rules and the other costs you actually pay. The calculator shows those parts separately rather than applying a generic multiplier.

Who must be automatically enrolled in a workplace pension?

Staff are usually eligible when they are aged from 22 to State Pension age, earn at least £10,000 a year and normally work in the UK. Other workers can have a right to opt in or join, so choose the pension basis that matches the person.

What earnings does the 3% employer pension use?

Under the common qualifying-earnings basis, the employer minimum applies to earnings between £6,240 and £50,270 for 2026/27. Check the scheme because another pensionable-pay definition can apply.

Does the calculator subtract Employment Allowance?

No. Employment Allowance applies at employer level, not separately to each employee. If the organisation qualifies, consider it once against the total employer NI bill.

Is this the amount payroll will charge?

No. It is an annual planning estimate using standard category A and even pay. Payroll should calculate the real pay periods, category letter, reliefs, deductions and submissions.

Keep going

Useful next steps

GuideUK statutory rates
TemplatePayroll hand-off checklist
GlossaryNational Insurance contributions

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