How to budget payroll cost
Turn gross pay into a full employer cost.
1
Enter gross pay
Use total annual wages for the team.
2
Apply employer taxes
Use local contribution rates and remember salary caps.
3
Add benefits
Include insurance, pension, allowances and other employer-paid benefits.
What does this tool do?
Payroll cost is gross wages plus the employer costs attached to them. Budgeting on gross pay alone understates cash needs, especially where social contributions and benefits are significant.
The Formula
Total payroll = Gross pay + (Gross pay × Employer tax rate) + BenefitsFrequently Asked Questions
What belongs in employer payroll taxes?
Mandatory social security, unemployment insurance, pension contributions and similar levies paid by the employer. Rates and caps vary by country and sometimes by salary level.
Should bonuses be included in gross pay?
Yes, if they are expected. Including a reasonable bonus provision avoids a cash shortfall when payments fall due.