Employee details
£
%
£
£
£
True annual cost of this employee
£0
total employment cost per year
£0Employer NIC
£0Pension contribution
£0Recruitment (amortised)
£0Training + on-costs
For guidance only — not financial, tax or legal advice. Verify with a qualified professional.
About the true cost of employment
What is included in the true cost of an employee?
Beyond salary: employer NIC (15% on earnings above £5,000 in 2026/27), pension (minimum 3% employer), recruitment costs, training, equipment, software and office space. Management overhead is additional and not included here.
What is the minimum employer pension contribution?
Under auto-enrolment, the minimum employer contribution is 3% of qualifying earnings (£6,240–£50,270 in 2026/27). Many employers contribute 5% or more. The combined minimum (employer + employee) is 8%.
How much does it really cost to replace an employee?
Studies put replacement cost at 6–9 months of salary for professional roles — including recruitment fees (15–20% of salary if using an agency), interview time, onboarding, and reduced productivity. High turnover is far more expensive than most businesses realise.
Can I claim the Employment Allowance?
Most businesses can offset up to £10,500 from their total employer NIC bill per year. You cannot claim if your total bill exceeded £100,000 in the prior year, or if you are a sole director company with no other employees.