Your Employment Package
Frequently Asked Questions
What counts as total compensation in the UK?
Total compensation includes your base salary plus all employer-provided benefits: employer pension contributions, annual bonus, private medical insurance (typically £1,000–£2,000/yr for individual cover), car allowance, life assurance, share options, flexible working arrangements, and additional holiday. A full package can be 20–40% above base salary.
How much is employer pension contribution worth?
The minimum employer pension contribution under auto-enrolment is 3% of qualifying earnings. Many employers contribute 5–10% or more. On a £40,000 salary, a 5% employer contribution is worth £2,000 per year — money you would otherwise have to fund yourself. This is a significant part of total compensation.
Is a car allowance part of total compensation?
Yes, a car allowance is taxable income and forms part of total compensation. Typical UK car allowances range from £3,000 to £10,000 per year depending on seniority and company policy. Some companies offer a company car instead, which has different tax implications via the Benefit in Kind (BiK) system.
How do I compare two job offers with different benefits?
Use this total compensation calculator for both offers. Enter the base salary and all benefits for each role. The total compensation figure gives a fair comparison. Also consider non-monetary factors: pension quality, career progression, job security, work-life balance, and culture.
What is the value of private medical insurance as a benefit?
UK employer-provided private medical insurance (PMI) typically costs £800–£2,500 per year for individual cover, depending on the insurer and level of cover. For family cover, this can reach £4,000–£8,000 annually. It is a taxable benefit in kind, so you will pay income tax on the declared value.