Hiring in the United Kingdom: three routes and who answers to HMRC
EREditorial team · Updated 14 Oct 202611 min read21 providers compared across EOR, COR and global payroll21 sources
£3,855 employer cost a month before the EOR fee, £40,000 salaryNot all-in: what it leaves out is under the cost table.
≈16% employer National Insurance and pension on top of salary
£12.71 National Living Wage an hour, aged 21 and over
21 EOR providers covering the UK
In the United Kingdom you can employ through your own company, use an Employer of Record or contract a self-employed person, and each route puts PAYE and status duties on someone different. With employer contributions, a £40,000 salary costs £3,855 a month.
Short answer
A £40,000 salary plus employer National Insurance and pension costs about £3,900 a month, before any EOR fee.
Your own company has to be registered with HMRC for PAYE before the first payday, and not more than two months ahead.
An EOR runs PAYE, but HMRC's umbrella-company rules can reach an EOR and let HMRC recover underpaid PAYE from the end client.
For a contractor working through their own company, a medium or large UK client decides IR35 status and gives its reasons.
None: a services contract with a self-employed person or their company
When the contract is signed
On the contract's own terms
Not a fit for someone your managers direct like staff; employment status applies to everyone, IR35 to those working through their own company.
In the UK the three routes differ mostly in who answers to HMRC. With your own company, you register as an employer for PAYE before the first payday, and no earlier than two months before it.[1] An EOR operates PAYE for you, but from 6 April 2026 HMRC’s umbrella-company rules let it recover underpaid PAYE from the end client,[2] and they cover any business that employs a worker to supply their labour, which can include an EOR;[3] the EOR page explains that rule. With a contractor who works through their own company, a medium or large client decides the tax status under the off-payroll rules (IR35),[4] a test the contractors page covers.
What one hire costs
Monthly cost of an employee on £40,000 a year: the cost before the EOR fee.
Assumes: Employee aged 22 or over on a permanent contract, earning at least GBP 10,000 a year and so auto-enrolled in a workplace pension at the legal minimum; no Employment Allowance claimed.
Cost before the EOR fee, a month£3,855
Gross salary£3,33386%
Employer contributions£52214%
Percentages are shares of the total, not of salary.
Employer auto-enrolment pension (minimum, qualifying earnings)[7][8]
3%
84
Cost before the EOR fee
3,855
Plus the EOR fee, not in this total. Published fees per employee: US$99 to US$699 a month (18 providers, USD); €299 a month (one provider, EUR). We add a fee to the total only when at least 3 providers publish one in GBP, and we do not convert currencies.
Employer National Insurance is charged on pay above the secondary threshold of GBP 5,000 a year, with no upper limit, and is shown before any Employment Allowance, which lets an eligible employer take up to GBP 10,500 a year off its employer National Insurance (a company whose sole director is its only employee liable for it cannot claim). The pension line is the legal minimum, 3% of qualifying earnings between GBP 6,240 and GBP 50,270; many schemes pay more. The Apprenticeship Levy (0.5%) is left out because it applies only to a pay bill above GBP 3 million. Employer's liability insurance, sick pay and other costs are not rates and are not included.
48 hours[11]Average weekly limit, normally over 17 weeks; a worker can opt out.
Statutory paid leave
28 days[12]5.6 weeks of paid holiday, which is 28 days on a five-day week; the statutory entitlement is capped at 28 days, and the employer may count bank holidays towards it.
Public holidays
8 days[13][14]England and Wales, 2026; Scotland and Northern Ireland differ. Employers need not give paid leave on bank holidays.
Sick pay
Statutory Sick Pay is up to GBP 123.25 a week, paid by the employer for up to 28 weeks.[15]
Public holidays by month
8 public holidays in England and Wales in 2026[13][14]
JanJ1
FebF0
MarM0
AprA2
MayM2
JunJ0
JulJ0
AugA1
SeptS0
OctO0
NovN0
DecD2
New Year's Day
Good Friday
Easter Monday
Early May bank holiday
Spring bank holiday
Summer bank holiday
Christmas Day
Boxing Day (substitute day)
Notice and severance
Minimum notice
1 week[16]One week after one month of service; one week for each completed year from two to twelve years; twelve weeks from twelve years.
Severance
Statutory redundancy pay after 2 years' service: half a week's pay for each full year under 22, one week's pay for each full year from 22 to 40, one and a half weeks' pay for each full year from 41[17][18]Redundancy only. Weekly pay is capped at GBP 751 and service at 20 years, so the most is GBP 22,530 for redundancies from 6 April 2026. An employee normally needs 2 years' service to claim unfair dismissal (1 year in Northern Ireland).
Income tax
Top income tax rate
45%[19]England, Wales and Northern Ireland, 2026-27 - personal allowance GBP 12,570, basic rate 20% to GBP 50,270, higher rate 40% to GBP 125,140, additional rate 45% above. The allowance is reduced by GBP 1 for every GBP 2 of income above GBP 100,000. Scotland sets its own bands.
A worker sponsored by a UK employer licensed by the Home Office with a certificate of sponsorship; salary at least GBP 41,700 a year or the going rate for the job, whichever is higher, with a reduced GBP 33,400 figure in some cases. Decisions normally take 3 weeks from outside the UK and 8 weeks from inside.
3–8
Registering as an employer
4 steps before the first payroll; what each involves and its source are on the payroll page.
New PAYE rules for labour supply chains with umbrella companies. HMRC defines an umbrella company to include any business supplying labour under a contract of employment, whatever it calls itself, so an employer of record can fall within it. Where one employs the worker, the agency, or the end client if no agency is involved, is responsible for PAYE being operated correctly, and HMRC can recover underpaid PAYE from it.[2][3]
The weekly pay cap for statutory redundancy pay is GBP 751, and the maximum payment GBP 22,530, for redundancies on or after this date.[17]
National Living Wage for workers aged 21 and over is GBP 12.71 an hour.[9]
Who can employ for you in United Kingdom
All 21 EOR providers we track that cover United Kingdom, ranked by our EOR score. How we score
Startups, growing companies and enterprises, the three segments Pebl writes a page for
Not for
Buyers who need a Contractor of Record: we list Pebl for contractor management, not COR
Top pro
Own SOC 2 Type 2 report and ISO/IEC 27001:2022 certificate, both on Pebl's security page
Top con
No live support channel named: Pebl lists its Alfie AI assistant, in-house experts and a Help Center; its pages say 24/7 support and do not say who answers
Its UK page does not state whether the employing entity is its own or a partner's.
7.4Our score 7.4 of 10Limited dataOur EOR score
EOR price from
US$459per employee a month, billed annually
EOR countries160 claimed, 106 documented
Onboarding2–3 days
ServicesEOR · COR · Contractors · Payroll
Best for
Companies from startups to enterprises, going by Multiplier's segment pages
Not for
Buyers who need the deposit amount before signing: Multiplier calculates it per contract
Top pro
Own SOC 2 (Type I and II), SOC 3 and ISO 27001:2022 on its security page; the AWS certifications listed there are kept apart as the host's
Top con
The "from" prices assume an annual contract. Monthly EOR costs $499 on Core and $559 on Growth, about 11% of countries are priced differently, and compliance-mandated add-ons come on top of EOR and COR
Companies from startups to enterprises: Playroll has pages for each, and its case studies include startups under 100 staff and mid-market firms of 100 to 1,000
Not for
Contractors who want to be paid other than through Payoneer, the only payout route Playroll uses
Top pro
Its own country pages document EOR hiring in 151 countries + 6 territories, against a claim of 180+
Top con
A refundable deposit of one month's salary per EOR employee; the unused part comes back within two months of the last working day, or once claims are settled if that is later
Enterprise teams and small and growing businesses (SMEs), in RemotePass's own words
Not for
Buyers who must review EOR contract terms up front: no EOR agreement is public
Top pro
EOR from $349 per employee a month with tax included; 13 of 20 other EOR prices in dollars start higher
Top con
No EOR agreement is public: the Terms say EOR runs under a separate Consultant Agreement "available on the Site", which we did not find. The public legal documents are the Terms, the Privacy Policy and the Acceptable Use Policy
A first hire in one new country or a team spread over many, at a startup, mid-market firm or enterprise (G-P has a page for each)
Not for
Buyers who rank EOR providers mostly by the monthly fee
Top pro
G-P claims EOR in 180+ countries; its Globalpedia country guides document 148 countries + 3 territories one by one
Top con
EOR from $599 per employee a month; 15 of 20 other EOR prices in US dollars that we compare start lower; volume discounts are offered but not quantified
Startups, scaling companies and enterprises, the three groups Native Teams writes for
Not for
Buyers who want to read the EOR or COR agreement before talking to sales: the terms of service are the only contract text online
Top pro
EOR from $99 per employee a month, below all 20 other per-employee EOR prices in USD we compare
Top con
The terms of service are the only contract text online. The EOR and COR agreements are not published, and the terms say a separate signed contract takes precedence
Crypto and web3 teams paying contractors in stablecoins or crypto, a segment Rise names (startups, web3 startups, DAOs, global agencies)
Not for
Companies that need an EOR in countries beyond the US and the UK today
Top pro
Prices are published per head: $49 a contractor a month (discounts for startups and non-profits), $299 for Agent of Record, $399 an employee for EOR
Top con
EOR is documented in 2 countries (US, UK) against a claim of 90+. The parent, Rise Works, Inc., is on the GLEIF register; no own entity is documented in either country
Publishes no EOR list price; each offer is a quote.
5.9Our score 5.9 of 10Limited dataOur EOR score
EOR price
Custom quote
EOR countries80 claimed, 59 documented
ServicesEOR · Contractors · Payroll
Best for
Small businesses, including teams under 10 employees, startups and enterprises: the segments Rippling has pages for
Not for
Buyers who want to compare an EOR price before a sales call
Top pro
Contractor onboarding in 185+ countries and payments in 50+ local currencies, per its contractor page; 160 countries + 2 territories are documented here
Top con
No price for EOR, contractor management or global payroll: the pricing page asks for a custom quote
Enterprise-level companies, the audience Atlas's enterprise page names
Not for
Buyers who need a Contractor of Record: under Atlas's AOR the contract stays between the client and each contractor
Top pro
EOR in 141 countries + 5 territories documented here, against a claim of 160+ with wholly owned entities
Top con
At $599 per employee monthly, the EOR price is above 15 of the 20 other USD EOR prices we compare and equal to 4; local employer services, FX and benefits premiums are billed on top
The first Contractor of Record providers from the contractors page, which also covers the employee test, tax and how to pay.
The first 3 of 13 COR providers we score: those working in United Kingdom first, each by our COR score. Working in United Kingdom: 9 (1 by their COR coverage list, the rest inferred from their EOR coverage). How we score
The first global payroll providers from the payroll page, which also covers set-up, registrations and filings.
The first 3 of 14 global payroll providers we score: those working in United Kingdom first, each by our global payroll score. Working in United Kingdom: 12 (2 by their global payroll coverage list, the rest inferred from their EOR coverage). How we score
Enterprise teams and small and growing businesses (SMEs), in RemotePass's own words
Not for
Buyers who must review EOR contract terms up front: no EOR agreement is public
Top pro
EOR from $349 per employee a month with tax included; 13 of 20 other EOR prices in dollars start higher
Top con
No EOR agreement is public: the Terms say EOR runs under a separate Consultant Agreement "available on the Site", which we did not find. The public legal documents are the Terms, the Privacy Policy and the Acceptable Use Policy
£12.71 an hour for workers aged 21 and over, the National Living Wage, from 1 April 2026. Lower rates apply to workers under 21 and to apprentices.
How much paid holiday does a UK employee get?
5.6 weeks a year, which is 28 days on a five-day week. Bank holidays do not have to be paid on top, and an employer can count them towards that entitlement.
Is there a statutory probation period in the UK?
No. The law does not require a probation period and sets no maximum length, so the employment contract decides whether there is one.
How much notice does a UK employer have to give?
At least one week after one month of service. From two years it is one week per completed year, up to twelve weeks from twelve years; contracts often give more.
How much statutory redundancy pay does a UK employee get?
After 2 years' service, half a week's to one and a half weeks' pay for each full year, depending on age. Weekly pay is capped at GBP 751 and service at 20 years, so the most is GBP 22,530.
Own entity — company register
