UK employer planning

UK pay rise cost calculator

See what a pay rise really adds to your annual payroll cost, not just the extra salary on paper.

This compares the employer cost of two salaries. It uses the same estimated National Insurance and pension assumptions for both sides so you can see the cost of the pay rise itself.

Extra annual employer cost

£5,900.00

£491.67 a month on average

Current salary
£45,000.00
Proposed salary
£50,000.00
Extra salary
£5,000.00
Extra employer National Insurance
£750.00
Extra employer pension
£150.00
Current total employer cost
£52,350.00
Proposed total employer cost
£58,250.00

This is a planning estimate. It does not model every benefit, payroll adjustment, bonus, holiday accrual or change in Employment Allowance across multiple employees.

Why this matters

A salary increase often costs more than the headline difference because employer National Insurance and pension contributions also rise. This helps you budget for retention, promotions or counter-offers.

How it differs from a salary calculator

This tool is for the employer side of the decision. It compares the full cost of the current role with the full cost of the proposed role, so you can see the real budget impact of a raise.

Important limits

It does not model every bonus, benefit or special NI relief and it treats Employment Allowance as a simple budget flag for this role. Use it as a planning estimate, not a payroll final.

Employer National Insurance thresholds and the Employment Allowance cap follow HMRC's 2026/27 employer rates and thresholds and Employment Allowance guidance.