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Payroll calculator

Payroll Employer Cost Calculator

Estimate the annual cost of employing staff, including gross salary, employer National Insurance, and employer pension contributions.

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Payroll

Payroll Employer Cost Calculator

Estimate salary, employer National Insurance, pension contribution, and total annual employment cost.

Total annual cost

£40,550

Gross salary cost

£35,000

Employer NI

£4,500

Employer pension

£1,050

Uses the 2026/27 secondary threshold of £5,000 and a 15% employer NI rate for standard employees.

These calculators provide estimates from the figures entered. They do not replace tax, payroll, or accounting advice for your specific business.

Guide

Plan the real cost of employment

Salary is only one part of employment cost. This calculator gives a clearer view of the annual employer cost before you hire or review payroll budgets.

How to use this calculator

  • Enter the annual gross salary for one employee.
  • Enter the number of employees on the same salary level.
  • Enter the employer pension contribution percentage used by your scheme.
  • Use the result to compare gross salary, employer NI, employer pension, and total annual cost.

What the results mean

  • Gross salary cost is the salary multiplied by the number of employees.
  • Employer NI estimates secondary Class 1 National Insurance for standard employees using the stated threshold and rate.
  • Employer pension is calculated from the salary and employer pension percentage entered.
  • Total annual cost combines gross salary, estimated employer NI, and estimated employer pension.

Figures to check first

  • Confirm whether employees are standard category employees or have special NI treatment.
  • Check whether your pension scheme calculates contributions on full salary or qualifying earnings.
  • Use annual salary figures for a clean annual estimate.
  • Review payroll costs again when salary, pension percentage, or tax-year rates change.

Common questions

Does this calculator include employee tax or employee National Insurance?

No. It focuses on employer cost, not employee take-home pay.

Does the pension estimate match every scheme?

Not always. Some schemes use qualifying earnings or other contribution rules, so the pension field is user-entered.

Can this be used for payroll budgeting?

Yes, it is useful for high-level budgeting, but payroll setup should be checked against the employee category and pension scheme.

Need payroll set up properly?

AMS can help with payroll registration, monthly payroll processing, pension administration, RTI submissions, P11D, and employee tax support.

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