Employer NI Calculator (UK)
Estimate Employer Class 1 National Insurance for a single employee using salary, pay frequency, tax year, and category.
What is Employer National Insurance?
Employer National Insurance (often called Employer NI, Employers' NICs, or secondary Class 1 NICs) is a payroll tax paid by businesses in the UK on employees’ earnings above certain thresholds. It is separate from the NI your employee sees deducted from their own payslip. In other words, it is an additional cost to the employer on top of gross salary.
If you are hiring, forecasting payroll costs, or comparing job offers internally, calculating employer NI correctly is essential. Even small errors can create budget surprises over a full year.
How this employer NI calculator works
This calculator annualises the pay figure you enter, applies the relevant threshold and rate for the selected tax year, then converts the result back into your chosen pay frequency. It also allows you to include any remaining Employment Allowance, which can reduce the NI due.
Inputs explained
- Gross pay: salary or wage before deductions.
- Pay frequency: monthly, weekly, fortnightly, 4-weekly, or annual.
- Tax year: thresholds and rates vary by year.
- Employee category: younger workers, some apprentices, and qualifying veterans can have different threshold treatment.
- Employment Allowance: available to eligible employers; can offset the annual NI liability.
Rates and thresholds used in this tool
| Tax Year | Standard Secondary Threshold (ST) | Upper Secondary Threshold (UST)* | Employer NI Rate | Employment Allowance Cap |
|---|---|---|---|---|
| 2025/26 | £5,000 | £50,270 | 15.0% | £10,500 |
| 2024/25 | £9,100 | £50,270 | 13.8% | £5,000 |
*UST used here for Under 21, Apprentice under 25, and Veteran category calculations.
Employer NI formula
Employer NI (annual) = max(0, Annual Earnings − Relevant Threshold) × Employer NI Rate
If Employment Allowance is available, then:
Employer NI due = max(0, Employer NI − Allowance Used)
Example scenario
Monthly pay: £3,000 (standard employee, tax year 2025/26)
- Annualised pay = £3,000 × 12 = £36,000
- Secondary threshold = £5,000
- Chargeable earnings = £31,000
- Employer NI = £31,000 × 15% = £4,650 per year
- Monthly equivalent = £4,650 ÷ 12 = £387.50
If you still have Employment Allowance remaining, the amount due can be reduced further.
Ways to manage employer NI costs
- Use Employment Allowance if your business qualifies.
- Plan total reward packages carefully (salary, pensions, and benefits interact with NI costs).
- Review worker category and age status so payroll treatment matches HMRC rules.
- Forecast annually, not just monthly, to avoid underestimating payroll overhead.
Common mistakes employers make
- Assuming employer NI is the same as employee NI deductions.
- Using out-of-date thresholds or rates from a prior tax year.
- Ignoring category-specific rules for under-21 staff or apprentices.
- Forgetting to apply available Employment Allowance.
- Budgeting from net pay instead of full employment cost.
Quick FAQ
Is this calculator suitable for payroll submission?
No. It is an estimate tool. Use compliant payroll software for official RTI submissions.
Does this include pension, student loan, or apprenticeship levy?
No. This calculator focuses only on employer NI.
Can I calculate multiple employees at once?
This version is for one employee at a time. Run each employee separately and sum totals for budget planning.
What if thresholds change?
Thresholds and rates can change in future fiscal updates. Recheck against HMRC each tax year.