How Much Does a Fractional Executive Cost in the UK?
Since April 2025, employer National Insurance rose to 15% - adding £29,000+ to the cost of a £200,000 executive. Fractional executives sidestep employer NIC entirely. Here's what the numbers look like.
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Employer National Insurance now sits at 15% — up from 13.8% — with the secondary threshold dropping to £5,000. On a £200,000 executive, that's £29,250/year in employer NIC alone, before pension contributions, employers' liability insurance, or recruitment fees. A fractional executive is engaged as a limited company contractor — employer NIC doesn't apply.
What UK Employers Actually Pay Above Base Salary
→ Employer Pension (Auto-Enrolment): Minimum 3% of qualifying earnings — typically £4,500–£9,000/year for executive salaries
→ Employers' Liability Insurance: Legally required — typically 0.5–1% of annual wage bill
→ Annual Leave: 28 days statutory minimum — approximately 10.7% of annual salary
→ Recruitment: Executive search fees typically 15–25% of first-year salary
A £200,000 base salary executive now costs £240,000–£260,000+ per year in total employer cost. A fractional retainer eliminates employer NIC, pension obligations, and all statutory leave costs.
Fractional vs Full-Time Executive Cost Comparison — United Kingdom (GBP)
Source note: Glassdoor UK (2025), Reed Executive (2025–26), CIPD (2025). True employer cost includes employer NIC at 15% (April 2025, secondary threshold £5,000), 3% auto-enrolment pension, 28 days statutory leave. All figures GBP
The ROI of going fractional
1. £29,250 saved on NIC alone On a £200,000 executive, employer NIC at 15%from April 2025 costs £29,250/year. Fractional sidesteps it entirely
2. No pension. No NIC. No leave Fractional executives are limited company contractors — outside employer obligations
3. Days not months Fractionus matches you with a vetted fractional executive in days, not the 90–120 day timeline of a traditional executive search
Day Rates vs Monthly Retainers
What About IR35?
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FAQs
Everything you need to know about fractional executive costs in the UK.
A: Fractional executive retainers in the UK typically range from £5,000 to £16,000 per month (GBP), depending on the role and scope. Fractional CFOs and CHROs start at the lower end (£5,000–£9,000/month), while fractional CMOs, CTOs, and CROs with full strategic leadership responsibility can reach £13,000–£16,000/month.
A: A fractional CMO in the UK typically charges £7,000 to £16,000 per month on retainer. This compares to a full-time CMO base salary of £140,000–£220,000 (Glassdoor UK, 2025), which with employer NIC, pension, and leave entitlements represents a true employer cost of £175,000–£290,000 per year. A fractional CMO retainer annualises to £84,000–£192,000 — a saving of 35–60%.
A: A fractional CFO in the UK typically costs £6,000 to £13,000 per month. Full-time CFO base salaries in the UK average £140,000–£220,000 — with employer NIC at 15%, pension, and leave entitlements, the true cost is £175,000–£290,000+ per year.
A: No. Employer National Insurance applies to employees on payroll (PAYE). Fractional executives engaged through Fractionus operate through their own limited companies as contractors — employer NIC does not apply. Since April 2025, employer NIC rose to 15% with the secondary threshold dropping to £5,000, making this distinction even more financially significant for UK businesses.
A: Most fractional executive arrangements fall outside IR35 — particularly where the executive works across multiple clients, operates through a limited company, and is not subject to supervision and control in the way an employee would be. Fractionus vets all executives on this basis.
A: Senior fractional executives in the UK typically charge £900 to £2,000 per day, depending on role and seniority. London-based executives tend to sit at the higher end. Day rates are most common for short-term or project-based engagements.
A: Top-tier management consulting firms in the UK bill £2,000–£5,000+ per day for senior partner time, with minimum engagements often exceeding £100,000. A fractional executive works at a fraction of that cost, is embedded in your team, and is accountable for outcomes — not recommendations.
A: Most fractional executive engagements in the UK run between 6 and 18 months. Shorter project-based engagements (3–4 months) are common for fundraising-specific CFO work. Some businesses transition their fractional executive to a full-time hire once growth justifies the headcount.
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