Employing someone on a £25,000 salary costs £28,563 per year (£2,380 per month) once you add employer NI at 15% and minimum auto-enrolment pension. That is £3,563 above the headline salary — a 14.2% uplift employers need to budget for before the first payslip.
£2,380 per month total employer cost.
£250 per month employer NI (£3,000 per year).
£3,563 per year above salary (14.2%).
| Item | Annual | Monthly |
|---|---|---|
| Salary | £25,000 | £2,083 |
| Employer NI (15% above £5,000) | £3,000 | £250 |
| Employer pension (3% minimum) | £563 | £47 |
| Total employer cost | £28,563 | £2,380 |
Employer NI for 2025/26 is charged at 15% on earnings above the £5,000 secondary threshold. The first £5,000 of salary is exempt.
| Earnings band | Rate | NI due |
|---|---|---|
| Up to £5,000 | 0% | £0 |
| £5,001 to £25,000 | 15% | £3,000 |
| Total NI (2025/26) | £3,000 |
Employment Allowance reduces the annual employer NI bill by up to £10,500 for eligible businesses and charities. Solo-director companies are excluded.
Without allowance: £3,000 employer NI per year.
With full £10,500 allowance applied: £0 NI due after offset.
From 6 April 2025, employer NI increased from 13.8% to 15% and the secondary threshold fell from £9,100 to £5,000. Both changes increase cost simultaneously — a higher rate applied to a wider NIable base.
2024/25 NI on this salary: £2,194 (13.8% above £9,100).
2025/26 NI on this salary: £3,000 (15% above £5,000).
Increase: £806 (36.7% more than 2024/25).
The figures above use 3% employer pension and no Employment Allowance. Use the full calculator to model different pension rates, overhead costs, and allowance scenarios.
Tax year 2025/26. Employer NI calculated at 15% on earnings above the £5,000 secondary threshold per HMRC rates and thresholds guidance. Auto-enrolment pension at employer minimum 3% on qualifying earnings between £6,240 and £50,270 per The Pensions Regulator guidance. Employment Allowance eligibility must be confirmed with HMRC or your accountant — this page shows both with and without scenarios. Overhead costs are excluded from this page — use the full calculator to include them.
Estimates only — not financial or legal advice. Sources: HMRC · The Pensions Regulator