BEHIND THE NUMBERS
How this calculation works
Worked example
£2,000 assignment less £25 margin funds salary and employer NI. Gross weekly salary is (£1,975 + £14.40) ÷ 1.15 = £1,729.913043. Annual gross £79,576, tax £19,262.40 and 46 weekly NI deductions of £73.26 leave £56,943.64 including holiday pay.
Example result: £56,943.64
Assignment rate and salary are different numbers
The umbrella must fund employment costs from the assignment income it receives. Entering a payslip’s gross salary as an assignment rate deducts employer costs twice. Check the agency’s Key Information Document for the correct starting figure.
Follow the employer-cost reconciliation
The breakdown lets you trace assignment income into margin, employer NI, levy, employer pension and salary. Employee tax and NI then come from salary. Changing an employer pension percentage therefore affects both the cost equation and the amount left for salary.
Accrued holiday changes when cash arrives
An accrued holiday pot may be held until leave is paid. This annual model includes it, so the weekly average should not be used as a promise of the next bank transfer. Rolled-up pay is restricted to qualifying irregular or part-year arrangements in Great Britain.
Assumptions and rounding
- Weekly equal assignment income and category A NI.
- Pension contributions use weekly qualifying earnings £120–£967 and an employee net-pay arrangement.
- All accrued holiday money is included in annual pay; cash-payment timing is simplified.
Questions about this calculator
Are employer NI and employee NI both included?
Yes. Employer NI is funded from the assignment rate; employee NI is deducted from the resulting salary.
Does the result include the umbrella margin?
Yes. The entered weekly margin is removed before gross salary is calculated.
Can I roll up holiday pay for any contractor?
No. This model permits it only for qualifying irregular-hours or part-year workers in Great Britain. Regular-hours and Northern Ireland arrangements must use the accrued option.