Market by market
Australia
The universal fixed cost is the 12% superannuation guarantee, now paid every payday under Payday Super. Payroll tax only starts above state thresholds (NSW $1.2M of annual wages, for example), so small employers often pay none. Workers compensation is compulsory everywhere but industry-rated, averaging roughly 1.3% to 1.8% of wages.
- Superannuation guarantee12% (max contribution base A$270,830 a year)
- Payroll tax4.75% to 6.85% by state, above thresholds
- Workers compensationCompulsory, industry-rated (state averages ~1.3-1.8%)
- The super rate has stopped climbing; 12% is the legislated end state.
- From 1 July 2026 contributions must reach the fund within 7 business days of payday.
Source: Australian Taxation Office (12% since 1 Jul 2025; Payday Super from 1 Jul 2026). Checked July 2026.
Canada
Canada's federal layer is CPP (5.95% employer to the C$74,600 ceiling, plus the CPP2 band at 4% up to C$85,000) and EI (1.4 times the employee rate, effectively 2.28% to the C$68,900 maximum). Ontario adds the Employer Health Tax at up to 1.95%, though a C$1M exemption spares most small employers, plus WSIB premiums averaging C$1.23 per C$100. Vacation pay of 4% to 6% is also a true payroll on-cost. Quebec swaps in QPP at 6.30%, QPIP and the Health Services Fund, so the two big provinces genuinely cost differently.
- CPP employer (2026)5.95% of C$3,500-C$74,600 + 4% CPP2 to C$85,000 (max C$4,646.45)
- EI employer (2026)2.282% to C$68,900 (max C$1,572.30)
- Ontario EHTUp to 1.95%; C$1M exemption for eligible employers
- WSIBIndustry-rated, 2026 average C$1.23 per C$100
- Vacation pay4% (under 5 years) / 6% (5+ years)
- Quebec runs a different stack: QPP 6.30%, QPIP 0.602%, reduced EI and the Health Services Fund.
- The caps mean the effective federal rate falls once salaries pass roughly C$85,000.
Source: Canada Revenue Agency (2026 rates from 1 Jan 2026). Checked July 2026.
New Zealand
New Zealand is the lightest of the six on fixed employer costs: 3.5% KiwiSaver (rising to 4% in April 2028) and an industry-rated ACC work levy averaging 0.69%. ESCT is deducted from the employer contribution rather than added on top, a detail that trips up cost models. There is no payroll tax and no separate social security charge.
- KiwiSaver employer minimum3.5% (4% from 1 Apr 2028)
- ACC work levyIndustry-rated, average NZ$0.69 per NZ$100 (excl GST)
- Payroll taxNone
- ESCTDeducted from the contribution, not added to it
- Employees can temporarily drop to 3%, which drops the employer minimum with them.
Source: Inland Revenue (3.5% from 1 Apr 2026). Checked July 2026.
Singapore
CPF is the big line: 17% employer contribution for employees aged 55 and below, on ordinary wages up to S$8,000 a month (S$102,000 a year all-in). It applies to Singapore Citizens and Permanent Residents only; work pass holders attract no CPF, though a foreign worker levy applies to work permit and S Pass holders. The Skills Development Levy adds 0.25%, capped at S$11.25 a month.
- Employer CPF (55 and under)17%, Citizens/PRs only
- Ordinary wage ceilingS$8,000/month since 1 Jan 2026
- Skills Development Levy0.25%, capped S$11.25/month, all employees
- Work pass holdersNo CPF; foreign worker levy instead
| Length of service | Entitlement |
|---|
| 55 and below | 17% |
| Above 55 to 60 | 16% |
| Above 60 to 65 | 12.5% |
| Above 65 to 70 | 9% |
| Above 70 | 7.5% |
- Senior-band rates step up again on 1 Jan 2027.
- The wage ceiling makes Singapore the only market here where the employer's effective rate drops as pay rises.
Source: CPF Board (Rates from 1 Jan 2026). Checked July 2026.
United Kingdom
Employer NI runs at 15% on everything above a low £5,000 threshold, which makes it the heaviest headline rate of the six markets at typical salaries. Auto-enrolment adds a 3% employer minimum, but on the qualifying band only, not gross pay, a distinction plenty of cost models get wrong. The Employment Allowance refunds up to £10,500 for eligible smaller employers, and the 0.5% Apprenticeship Levy only bites above £3M of paybill.
- Employer NI15% above £5,000/year
- Pension minimum3% of the £6,240-£50,270 band
- Employment AllowanceUp to £10,500 off NI for eligible employers
- Apprenticeship Levy0.5%, paybills over £3M
- Pension minimums are band-based: on a £100,000 salary the 3% applies to £44,030 of it, not the full amount.
Source: HMRC (2026-27 rates). Checked July 2026.
United States
The fixed federal load is FICA: 6.2% Social Security up to US$184,500 (2026) and 1.45% Medicare with no cap. The extra 0.9% Medicare tax above US$200,000 is employee-only, so it never belongs in an employer cost model. Net federal unemployment tax is US$42 a head. The variable load, state unemployment tax and workers compensation, differs by state and industry and usually outweighs FUTA many times over.
- Social Security6.2% up to US$184,500 (2026)
- Medicare1.45%, no cap (the 0.9% surtax is employee-only)
- FUTA0.6% of the first US$7,000 (max US$42)
- State-ratedSUTA + workers compensation, varies
- Health cover is the elephant: not a payroll tax, but the ACA employer mandate applies at 50+ full-time staff and dwarfs FICA in practice.
- BLS benefit shares are quoted against total compensation, not salary; misreading that double-counts.
Source: Social Security Administration / IRS (2026 wage base). Checked July 2026.
Plain-English definitions in the HR Glossary: superannuation guarantee, cpf contributions.
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