Employer on-costs: Australia vs United Kingdom

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.

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.

The maths: Australia

Plus state payroll tax above thresholds (4.75% to 6.85%) and industry-rated workers compensation.

The maths: United Kingdom

Eligible employers deduct up to £10,500 Employment Allowance from the NI bill; the 0.5% Apprenticeship Levy applies above £3M of paybill.