Employer NI at 15% on director salary above £5,000 is a real company cost. This version highlights the employer NI figure alongside the salary cost and the personal take-home trade-off.
Updated for 2026/27. Uses UK corporation tax, dividend tax and PAYE assumptions. Estimates only — not tax advice.
Calculate company tax Read the guidesCalculate employer National Insurance on director salary 2026/27. 15% on salary above £5,000. See the true company cost and personal take-home trade-off.
Updated for 2026/27. Written and reviewed by James Whitfield against current GOV.UK and HMRC guidance · Editorial standards · Methodology. Estimates for planning only — not tax, accounting or financial advice.
Figures reviewed for the 2026/27 tax year (last updated July 2026). Source: GOV.UK.
This calculator focuses on the employer's National Insurance a limited company pays on a director's salary. Employer (secondary) National Insurance is charged at 15% on salary above the £5,000 secondary threshold. It is a company cost, entirely separate from the employee National Insurance and income tax the director pays personally.
This is why a salary of £12,570, chosen to use the full Personal Allowance, still triggers some employer National Insurance: the £5,000 secondary threshold is lower than the £12,570 the director is paid, so 15% applies to the slice between the two. Many single-director companies accept this small charge because the salary remains a deductible business expense.
The Employment Allowance, which can offset up to £10,500 of employer National Insurance, is generally not available to a company whose only employee is a single director. That exclusion is why the employer National Insurance on a sole director's salary usually cannot be wiped out, and it is a key reason directors weigh salary level against the resulting company cost.
Employer National Insurance is charged only on the slice of salary above the £5,000 secondary threshold. On the popular £12,570 salary that means 15% applies to just £7,570:
A single-director company generally cannot claim the £10,500 Employment Allowance, so this £1,135.50 stands. But because employer NI is itself a deductible expense, its true cost after corporation tax relief is nearer £920 — small enough that most directors still prefer the £12,570 salary for the Personal Allowance it uses.
The rates and rules on this page are drawn from the official UK government sources below, using the confirmed 2026/27 figures. Each link opens the relevant HMRC, GOV.UK or Companies House page in a new tab.
A limited company must keep its finances separate from personal accounts. These accounts are free to open.
Companies House now charges £100 to register a limited company online (up from £50 in February 2026). Same-day digital registration is £156. You can register directly at gov.uk or through a formation agent.