1. What Is Cost To Company?

Cost To Company (CTC) represents the total amount of money an employer spends on an employee in a year. It includes the gross salary plus employer contributions to National Insurance and pension schemes.

2. How Does The Calculator Work?

The calculator uses the CTC formula:

Where:

• \( Salary \) — Gross annual salary in GBP
• \( NI \) — Employer National Insurance contributions
• \( Pension \) — Employer pension contributions

Explanation: The formula calculates the total employment cost by adding the base salary to mandatory employer contributions for National Insurance and pension schemes.

3. Importance Of CTC Calculation

Details: Understanding CTC helps both employers budget accurately for staffing costs and employees understand their total compensation package beyond just take-home pay.

4. Using The Calculator

Tips: Enter gross annual salary in GBP, National Insurance rate as percentage, and pension contribution rate as percentage. All values must be valid (salary > 0, rates between 0-100).

5. Frequently Asked Questions (FAQ)

Q1: What is included in Cost To Company?
A: CTC includes gross salary, employer NI contributions, employer pension contributions, and may include other benefits like health insurance, bonuses, and allowances.

Q2: What are typical NI and pension rates in the UK?
A: Employer NI is typically 13.8% on earnings above £9,100, while pension auto-enrolment requires minimum 3% employer contribution.

Q3: How does CTC differ from take-home pay?
A: CTC is the total cost to employer, while take-home pay is salary after deductions for tax, employee NI, and pension contributions.

Q4: Are bonuses included in CTC?
A: Yes, bonuses and other variable pay should be included in the salary component when calculating total CTC.

Q5: Why is CTC important for job offers?
A: CTC provides a complete picture of the employment package, helping candidates compare offers from different companies more accurately.