Answers · UK 2025/26
What is the employer National Insurance secondary threshold for 2026/27?
For 2026/27, employers pay National Insurance at 15% on each employee's earnings above GBP 5,000 per year (the secondary threshold). This threshold dropped sharply from GBP 9,100 in 2025/26, significantly increasing employer NI costs.
Full answer
The Employer NI Secondary Threshold for 2026/27 From April 2026, employers must pay Class 1 secondary National Insurance contributions (NIC) at 15% on any employee's gross earnings above GBP 5,000 per year (roughly GBP 417 per month or GBP 96 per week). This is the secondary threshold -- the point at which employer NI liability begins. How the rate changed In 2025/26 the secondary threshold stood at GBP 9,100. The reduction to GBP 5,000 for 2026/27 means employers start paying NI much earlier in the pay scale. For a full-time worker on the National Living Wage of GBP 12.71/hour (approximately GBP 26,436/year for a 40-hour week), the employer NI bill rises compared with previous years. Employment Allowance offset To cushion the blow for smaller businesses, the Employment Allowance increased to GBP 10,500 for 2026/27. This allowance offsets employer NI liabilities directly. Eligible employers -- broadly those whose employer NI bill was under GBP 100,000 in the previous tax year -- can deduct up to GBP 10,500 from their total employer NI bill each year. This means many micro-businesses and small employers with a handful of staff will have their employer NI liability reduced to zero or near zero. Practical example An employee earning GBP 30,000 per year: - Earnings above threshold: GBP 30,000 minus GBP 5,000 = GBP 25,000 - Employer NI due: 15% x GBP 25,000 = GBP 3,750 For comparison, under 2025/26 rules (13.8% above GBP 9,100): - GBP 20,900 x 13.8% = GBP 2,884 The 2026/27 change therefore costs this employer an extra GBP 866 per year for this one employee. Key points to remember - Secondary threshold: GBP 5,000/year (down from GBP 9,100) - Employer NI rate: 15% (up from 13.8%) - Employment Allowance: GBP 10,500 (up from GBP 5,000) - There is no upper earnings limit for employer NI -- the 15% rate applies on all earnings above GBP 5,000 - Employee NI rates are separate and unaffected by the secondary threshold Employers should factor these changes into payroll budgets and employment cost forecasts for the 2026/27 tax year.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.