Hiring in the UK: Costs, Contracts and IR35

For a US company hiring its first person in Europe, the UK is the path of least resistance. Same language, same contract conventions, closest working hours, and the deepest pool of candidates already used to working with American teams.

The cost structure is simple too, at least on paper. The complication is one set of tax rules with an unfriendly reputation, and it is worth understanding rather than avoiding.

What does it actually cost to employ someone in the UK?

Employer National Insurance is 15% on earnings above £5,000 a year, and unlike the employee side there is no upper limit. The 15% applies to everything above that threshold however senior the person is.

Add the workplace pension, where employers must contribute a minimum of 3% of qualifying earnings, and your loaded cost sits somewhere around 18 to 19% above salary for most roles. On a £60,000 salary that is roughly £71,000 all in.

That is lower than Spain and broadly comparable to Germany at mid-level salaries, though Germany's ceilings make it cheaper at the senior end. What the UK does not have is Germany's ceiling, so like Portugal your employer cost keeps climbing with salary.

What is IR35 and does it apply to a US company?

IR35, now usually discussed as the off-payroll working rules, exists to stop people working like employees while invoicing through their own limited company to pay less tax. It decides whether a contractor should be taxed as employed based on how the work actually happens.

Here is the part that matters to you: where the client is a wholly overseas organisation with no UK presence, responsibility for determining status generally stays with the contractor's own company rather than transferring to you. That is a meaningful difference from hiring as a UK-based business, and it is why many US companies engage UK contractors comfortably.

Treat that as a reason to check your specific position, not a reason to relax. "No UK presence" is a test with detail behind it, and if your company has any UK establishment the analysis changes. Confirm it with a UK adviser before you build a team on the assumption.

How much overlap do you get with US working hours?

The best of any country on this list. The UK is five hours ahead of US Eastern, so a 9 to 6 London day overlaps from 4am to 1pm Eastern, giving you a genuine four to five hour shared window with the East Coast and the start of the West Coast morning.

For roles that need live collaboration, customer calls or fast back-and-forth with a US team, this is the practical reason to pay the UK premium over Poland.

Which roles is the UK genuinely strong for?

Engineering, sales and business development, and operations. As of 8 September 2026 our board carries around 1,071 open roles from companies hiring people based in the UK, the largest pool of any country we track.

The UK is the natural pick for anything customer-facing into US or global markets, senior commercial roles, and engineering where communication with a US team is constant. It is also the most expensive of the five on salary alone, which is the honest trade-off for the overlap and the language.

What catches US companies out in the UK?

Assuming UK employment works like US employment because the language is shared. It does not. Statutory notice, holiday entitlement of at least 28 days including public holidays, statutory sick pay and unfair dismissal protections after two years are all real obligations with no US equivalent.

The second is treating IR35 as settled because someone read a blog post. Status depends on the working relationship, and the overseas-client position is a specific carve-out rather than a blanket exemption. Get it confirmed for your setup.

The short version

The UK gives you the best US timezone overlap in Europe, the largest candidate pool on our board, and a flat 15% employer National Insurance charge with no upper limit. Salaries are the highest of the five. IR35 is manageable for a genuinely overseas company but deserves a proper check rather than an assumption.

Want the real number for your role? The salary calculator puts a US hire, a self-managed European hire and hiring through us side by side, with taxes and overhead included.

If you would rather have the search done for you, that is our job: we headhunt across Europe and deliver a shortlist of pre-vetted candidates for a flat $6,500, backed by a 12-month replacement guarantee.

Related guides

Comparing countries? Read the same breakdown for Poland, Germany, Spain and Portugal, or start with the country-by-country overview. For how to pay someone once you have chosen, read contractor or employer of record.

This is general information, not legal or tax advice. Rates, thresholds and the off-payroll rules change, and your situation may differ. Confirm the specifics with a qualified UK adviser before you sign anything.

Employer National Insurance rates and thresholds: GOV.UK National Insurance rates and categories. Role counts measured on our own board on 8 September 2026.