National Minimum Wage and National Living Wage Rates for 2026/27
From April 2026, the UK's minimum wage rates are increasing again. The National Living Wage (NLW) — which applies to workers aged 21 and over — rises to £12.50 per hour. This is a meaningful increase that puts more money in the pockets of the lowest-paid workers, but the question everyone asks is: how much will I actually take home after tax and National Insurance?
The New Rates from April 2026
Here are the confirmed hourly rates for the 2026/27 tax year, as announced by the Low Pay Commission and published on GOV.UK:
- National Living Wage (21 and over): £12.50 per hour
- 18 to 20 year olds: £10.36 per hour
- Under 18: £7.84 per hour
- Apprentice rate: £7.84 per hour
The government has progressively raised the NLW in recent years and has signalled its intention to continue doing so. The gap between the rates for different age groups has also been narrowing, with the 18–20 rate seeing a significant boost in April 2025 and further increases in 2026.
Annual Salary on Minimum Wage
If you work a standard 37.5-hour week on the National Living Wage, your annual gross salary works out as follows:
- Weekly pay: £12.50 × 37.5 = £468.75
- Monthly pay: approximately £2,031.25
- Annual gross salary: £24,375
This is well above the Personal Allowance of £12,570, which means you will pay income tax on approximately £11,805 of your earnings. Understanding exactly how much tax you owe — and what you actually take home — is crucial for budgeting.
Tax and National Insurance Deductions
For the 2026/27 tax year, the key thresholds and rates that affect minimum wage workers are:
Income Tax
- Personal Allowance: £12,570 (no tax on this amount)
- Basic rate: 20% on income from £12,571 to £50,270
On a £24,375 salary, your taxable income is £11,805. At 20%, that gives an income tax bill of approximately £2,361 per year (£196.75 per month).
National Insurance Contributions
Employee National Insurance for 2026/27:
- Primary Threshold: £12,570 per year (£242 per week)
- Rate: 8% on earnings between £12,570 and £50,270
On a £24,375 salary, you pay NI on £11,805 of earnings. At 8%, that is approximately £944 per year (£78.70 per month).
Your Take-Home Pay
Putting it all together for a full-time worker (37.5 hours per week) on the National Living Wage:
- Gross annual salary: £24,375
- Income tax: −£2,361
- National Insurance: −£944
- Annual take-home pay: approximately £21,070
- Monthly take-home pay: approximately £1,756
- Weekly take-home pay: approximately £405
That means you keep roughly 86% of your gross pay. While the tax burden is relatively light at this income level, National Insurance and income tax still take a noticeable chunk.
How Different Hours Affect Your Take-Home
Not everyone works a standard 37.5-hour week. Here is how different weekly hours affect your annual take-home at the £12.50 NLW rate:
- 16 hours/week (part-time): Gross £10,400 — below the Personal Allowance, so no tax or NI. Take-home: £10,400.
- 20 hours/week: Gross £13,000 — minimal tax and NI. Take-home: approximately £12,866.
- 30 hours/week: Gross £19,500 — take-home: approximately £17,558.
- 40 hours/week: Gross £26,000 — take-home: approximately £22,418.
Workers on fewer than about 19.3 hours per week at £12.50/hour will earn below the Personal Allowance and pay no income tax at all. This is a useful threshold to be aware of, particularly for those considering part-time work alongside other commitments.
Benefits You Might Also Be Entitled To
If you earn the minimum wage, you may also be entitled to means-tested benefits that can significantly boost your household income:
- Universal Credit: Available to workers on low incomes, with the work allowance and taper rate determining how much you receive on top of your earnings.
- Council Tax Reduction: Many councils offer reductions for low-income households. Check with your local authority.
- Free school meals and Healthy Start vouchers: Available to families on qualifying benefits.
- Help with childcare costs: Universal Credit can cover up to 85% of eligible childcare costs, and Tax-Free Childcare offers up to £2,000 per child per year.
Many people miss out on benefits they are entitled to simply because they do not check. Our benefits calculator can help you find out what additional support is available to your household.
Calculate Your Exact Take-Home Pay
The figures above are estimates for a typical situation. Your exact take-home pay depends on factors such as your tax code, student loan repayments, pension auto-enrolment contributions, and any other deductions. Use our free minimum wage calculator to enter your specific hours and circumstances, and see precisely what you will take home each week, month, and year in 2026/27.