How much employer NI do I pay?

Employers pay 13.8% National Insurance on employee earnings above £5,000 per year (the Secondary Threshold) in 2026/27. On a £30,000 salary, employer NI is £3,450; on £50,000 it's £6,210; and on £100,000 it's £13,110. This is in addition to the employee's salary and any pension contributions.

What is the employer NI threshold 2026/27?

The employer NI Secondary Threshold is £5,000 per year in 2026/27. Employers pay 13.8% on all employee earnings above this threshold. The threshold was reduced from £9,100 to £5,000 from April 2025, significantly increasing employer costs.

Is employer NI changing in 2026/27?

The employer NI rate remains at 15% with the Secondary Threshold at £5,000 in 2026/27 — the same as 2025/26. The rate was increased from 13.8% to 15% and the threshold lowered from £9,100 to £5,000 in April 2025. The Employment Allowance is £10,500, helping smaller businesses.

Do employers pay NI on pension contributions?

Employers don't pay NI on pension contributions made through salary sacrifice. This is one reason salary sacrifice is popular — both the employee and employer save NI. If pension contributions are made outside salary sacrifice (e.g., employer just contributes extra), the employer doesn't pay NI on those amounts either.

Employer National Insurance Costs 2026/27 — How Much Does an Employee Really Cost? | PocketWise

Employer National Insurance Costs 2026/27 — How Much Does an Employee Really Cost?

Complete guide to employer NI contributions in 2026/27. Calculate the true cost of employing someone including employer NI, pension, and other on-costs.

By PocketWise · 8 April 2026 · 3 min read

Employer National Insurance is a significant hidden cost of employment. Here’s how it works in 2026/27 and what it means for both employers and employees.

Employer NI Rates 2026/27

Element	2026/27
Rate	15%
Secondary Threshold	£5,000/year
Employment Allowance	£10,500
Applies to	All earnings above £5,000

Employer NI at 15% applies to all employee earnings above the £5,000 Secondary Threshold. There is no upper limit — unlike employee NI which drops to 2% above £50,270.

Employer NI by Salary Level

Employee salary	Employer NI (15%)	Total employment cost	NI as % of salary
£12,570	£1,136	£13,706	9.0%
£20,000	£2,250	£22,250	11.3%
£25,000	£3,000	£28,000	12.0%
£30,000	£3,750	£33,750	12.5%
£35,000	£4,500	£39,500	12.9%
£40,000	£5,250	£45,250	13.1%
£50,000	£6,750	£56,750	13.5%
£60,000	£8,250	£68,250	13.8%
£70,000	£9,750	£79,750	13.9%
£80,000	£11,250	£91,250	14.1%
£100,000	£14,250	£114,250	14.3%

True Cost of an Employee

Employer NI is just one component. The full cost of employing someone includes:

Cost element	On £40,000 salary	On £60,000 salary
Gross salary	£40,000	£60,000
Employer NI (15%)	£5,250	£8,250
Pension (3% minimum)	£1,200	£1,800
Apprenticeship Levy (if applicable)	£200	£300
Total minimum cost	£46,650	£70,350

Additional Employment Costs

Many employers also face:

Holiday pay (28 days statutory = ~10.8% of salary)
Sick pay (SSP or enhanced)
Training and development
Equipment, office space, software
HR, payroll, and admin costs
Benefits (health insurance, life cover, etc.)

A common rule of thumb is that the true cost of an employee is 1.3–1.5 times their salary.

The 2025 Employer NI Increase — Impact

From April 2025, employer NI changed significantly:

Element	Before April 2025	From April 2025
Rate	13.8%	15%
Secondary Threshold	£9,100	£5,000
Employment Allowance	£5,000	£10,500

Cost Impact by Salary

Salary	Old employer NI	New employer NI	Annual increase
£20,000	£1,504	£2,250	+£746
£30,000	£2,884	£3,750	+£866
£40,000	£4,264	£5,250	+£986
£50,000	£5,644	£6,750	+£1,106
£70,000	£8,404	£9,750	+£1,346

The increase hits lower-paid workers hardest proportionally, as the lower Secondary Threshold means NI starts £4,100 earlier.

Employment Allowance

The Employment Allowance allows eligible employers to reduce their NI bill by up to £10,500 per year:

Eligibility	Details
Available to	Employers with NI bill under £100,000 in previous year
Not available to	Single-director companies with no other employees
Amount	Up to £10,500 off annual employer NI
Applied	Automatically through payroll software

For a small business with 3 employees on £30,000 each:

Total employer NI: 3 × £3,750 = £11,250
Employment Allowance: -£10,500
NI actually paid: £750

How Salary Sacrifice Saves Employer NI

When an employee agrees to salary sacrifice (e.g., for pension, EV, or cycle to work), their contractual salary reduces. This saves employer NI on the sacrificed amount:

Example: £40,000 salary, £4,000 pension sacrifice	Without sacrifice	With sacrifice
Gross salary	£40,000	£36,000
Employer NI	£5,250	£4,650
Employer NI saving	—	£600

Many employers pass some or all of this saving back to employees as additional pension contributions, making salary sacrifice beneficial for both parties.

Employer NI on Different Payment Types

Payment type	Employer NI due?
Basic salary	Yes
Overtime	Yes
Bonuses	Yes
Commission	Yes
Holiday pay	Yes
Statutory sick pay	Yes
Pension contributions (employer)	No
Salary sacrifice amounts	No (on the sacrificed portion)
Benefits in kind	Some (Class 1A NI at 15%)
Mileage within HMRC rates	No
Genuine expenses/reimbursements	No

Employer NI for Self-Employed

Self-employed individuals don’t pay employer NI if they work alone. However, if they employ staff, they pay exactly the same employer NI rates as any other business.

For contractors working through a limited company (IR35):

Outside IR35: The company pays employer NI on the director’s salary
Inside IR35: The end client or agency pays employer NI on the deemed employment payment