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Before you advertise

Hiring a payroll administrator: what it costs, and what the week is spent on

The UK median for this job is £31,560, which costs an employer about £36,304 a year once National Insurance and the minimum pension are added. Whether that is money well spent depends on what the week is actually made of, so this page breaks the job down first.

Last checked 19 September 2026

What the job costs #

Salary is the part everyone quotes and the smallest part of the decision. Here is the employment cost at the national median, using the rates in force for the 2026 to 2027 tax year.

£31,560

Median salary

ONS ASHE 2025 (provisional), SOC 4122

£36,304

Employment cost a year

Salary, employer NI and minimum pension

£21

Per hour worked

37.5 hour week, 46.4 working weeks

ItemA yearWhere it comes from
Median salary £31,560 ONS ASHE 2025 (provisional), SOC 4122
Employer National Insurance £3,984 15 per cent above £5,000
Minimum workplace pension £760 3 per cent of qualifying earnings
Employment cost £36,304 About £21 an hour on a 37.5 hour week

Recruitment, equipment, software seats, training and cover for holiday and sickness all sit on top, and they vary too much between businesses to put a number on here.

If you want to run your own figures, the true cost of an employee tool does this with your salary, hours and on costs.

What the week is actually made of #

Here is the job as it usually runs in a business, split by whether the work follows a fixed pattern or needs a person to decide something. This split is our analysis, not a survey, and your version of the role will differ.

Runs to a pattern (7 of 12)

  • Collect and check timesheets and overtime weekly

    Totals against rotas and contracted hours.

  • Enter starters, leavers and contract changes weekly

    Fixed fields, fixed effective dates.

  • Apply tax code and student loan notices from HMRC weekly

    HMRC sends a code, you apply it.

  • Submit the Full Payment Submission to HMRC monthly

    A file with a deadline.

  • Assess auto enrolment and upload pension contributions monthly

    Thresholds and percentages published each year.

  • Reconcile payroll back to the nominal ledger monthly

    A matching exercise with a known answer.

  • Produce P45s, P60s and P11Ds monthly

    Generated from data already held.

Needs a person (5 of 12)

  • Run the payroll and review the gross to net report monthly

    Spotting the number that looks wrong before it is paid.

  • Process statutory sick, maternity and paternity pay monthly

    Eligibility rules meet real situations that do not fit them.

  • Apply attachment of earnings orders monthly

    Priority and protected earnings have to be got right.

  • Answer employee pay queries weekly

    People are upset about money and need a person.

  • Apply the new rates and thresholds each April monthly

    Knowing which changes affect this payroll.

What to do before you advertise #

The question is not whether to hire. It is what the person will be doing on a Tuesday afternoon in March. Two things are worth doing first, and both take less effort than writing the advert:

  1. Count the week you are about to buy

    Write down the jobs this role would pick up, how long each takes and how often it happens. The cost of admin time calculator adds it up and puts a cost on it.

  2. Separate the pattern from the judgement

    If most of the hours sit in the first list above, a hire will absorb the pressure rather than remove it, and the same pressure returns when the business grows again.

Plenty of businesses do both: automate the repeated half, then hire someone to do the half that needs a person, often part time or at a level that keeps them interested. That is a better job than the one the advert usually describes.

Where this role usually sits #

This job turns up most often in accountancy , care , logistics and haulage , cleaning and facilities , recruitment and schools , and the admin around it looks different in each.

A note on the pay figure #

£31,560 is the median for full time employees in SOC 4122, Book-keepers, payroll managers and wages clerks, from the ONS Annual Survey of Hours and Earnings, 2025 (provisional). ONS publishes a coefficient of variation with every figure, and this one is 2.1 per cent, which ONS treats as reliable.

It is a national figure covering every employer size and region. What a specific business pays depends on where it is, how specialised the job is, and what else is on offer nearby.

Questions people ask

What does a payroll administrator actually cost a year?
At the UK median of £31,560, employer National Insurance adds about £3,984 and the minimum workplace pension about £760, so the employment cost is roughly £36,304 a year before recruitment, equipment, software or cover. That is about £21 for every hour worked on a 37.5 hour week.
What is the median salary for a payroll administrator in the UK?
£31,560 for full time employees, from the ONS Annual Survey of Hours and Earnings, 2025 (provisional), under SOC 4122 Book-keepers, payroll managers and wages clerks. Half of people in that group earn more and half earn less, and pay in the south of England tends to sit above the national figure.
Which parts of this job follow a fixed pattern?
Of the 12 jobs listed on this page, 7 run to a pattern: collect and check timesheets and overtime, enter starters, leavers and contract changes, apply tax code and student loan notices from hmrc. That is our reading of the role rather than a measurement of yours, and the only way to know what your version of the job actually looks like is to count a real week.
Should I hire or automate?
Usually both, in that order. Automate the part of the week that runs on rules, then hire for the part that needs a person, because that is the part that is hard to replace and the part people want to do. The mistake is hiring to absorb repeated admin and then discovering the same pressure a year later.

Where these numbers come from

  1. Office for National Statistics, Annual Survey of Hours and Earnings, Table 14.7a Annual pay gross, occupation by four-digit SOC 2020 , read 19 September 2026 . 2025 (provisional) edition, SOC 4122. ONS coefficient of variation 2.1 per cent
  2. GOV.UK, Rates and thresholds for employers 2026 to 2027 , read 19 September 2026
  3. GOV.UK, Workplace pensions: what you, your employer and the government pay , read 19 September 2026
  4. GOV.UK, Holiday entitlement , read 19 September 2026

Last checked 19 September 2026.

Our workings are on the methodology page .

Before you hire

See what a payroll administrator would spend their week on

Hiring is the right answer for plenty of the work. The audit separates the part that needs a person from the part that runs on rules, so whoever you hire spends their time on the first kind.

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