National Minimum Wage April 2026: New Rates, Take-Home Pay & What Changes
The National Living Wage rose to £12.71/hour from 1 April 2026 — a 4.1% increase. We cover all NMW/NLW rates, the impact on 2 million workers, take-home pay at NLW, employer compliance, and what the rise means for household budgets.
The April 2026 rate rise: what changed
On 1 April 2026, new National Minimum Wage rates came into force across all age bands. The headline figure — the National Living Wage for workers aged 21 and over — rose from £12.21 to £12.71 per hour, a rise of 50 pence or 4.1%.
This is the seventh consecutive annual rise above inflation under the government's commitment to raise the NLW toward two-thirds of median hourly earnings.
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Open Minimum Wage calculatorThe full 2026/27 NMW/NLW rate table
| Category | Rate from April 2026 | Previous rate | Change |
|---|---|---|---|
| National Living Wage (aged 21+) | £12.71/hr | £12.21/hr | +50p (+4.1%) |
| Aged 18–20 | £10.00/hr | £8.60/hr | +£1.40 (+16.3%) |
| Aged 16–17 | £7.55/hr | £6.40/hr | +£1.15 (+18.0%) |
| Apprentice rate | £7.55/hr | £6.40/hr | +£1.15 (+18.0%) |
| Accommodation offset | £10.01/day | £9.99/day | +2p |
The large increases for under-21 workers and apprentices reflect a separate government commitment to narrow the gap between youth and adult rates.
Who qualifies for which rate?
National Living Wage (£12.71/hour): all workers aged 21 and over, regardless of how long they have worked for the employer or whether they are part-time.
Aged 18–20 rate (£10.00/hour): workers aged 18, 19 or 20 on the date of payment.
Aged 16–17 rate (£7.55/hour): workers aged 16 or 17. Note: workers cannot legally be paid for the first year of apprenticeship at less than the apprentice rate, regardless of age.
Apprentice rate (£7.55/hour): applies to apprentices who are either: (a) under 19 years old; or (b) in the first year of their apprenticeship at any age. Once an apprentice turns 19 and completes their first year, they move to the age-appropriate NMW rate.
Take-home pay at NLW full-time 2026/27
At £12.71/hour, a full-time worker on 37.5 hours per week earns:
Gross annual salary: £12.71 × 37.5 × 52 = £24,784
| Deduction | 2026/27 amount |
|---|---|
| Personal Allowance | £12,570 (0% IT) |
| Taxable income | £12,214 |
| Income Tax (20%) | £2,443 |
| Employee NI (8% on £12,214) | £977 |
| Net take-home | ~£21,364 |
Wait — let me recalculate properly. NI applies above the Primary Threshold of £12,570 — same as the Personal Allowance for 2026/27. So:
- Gross: £24,784
- Personal Allowance: £12,570
- Taxable income: £12,214
- Income Tax at 20%: £2,443
- NI Primary Threshold: £12,570
- NI: £(24,784 − 12,570) × 8% = £12,214 × 8% = £977
- Net take-home: £24,784 − £2,443 − £977 = £21,364/year = £1,780/month
Compared with 2025/26 at £12.21/hour (gross £23,809/year, net ~£20,524): the NLW rise adds approximately £840/year to take-home pay — or about £70/month.
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Calculate your exact take-home from your hourly rateThe broader impact: 2 million workers
The Low Pay Commission estimated that approximately 2 million workers received a pay rise as a direct result of the April 2026 NLW increase. These workers are concentrated in:
- Retail: supermarket floor staff, shop assistants
- Hospitality: restaurant, café and hotel workers
- Social care: home care workers (chronically underpaid sector; NLW a critical floor)
- Cleaning and facilities management
- Agriculture: seasonal and permanent farm workers
A full-time NLW worker who previously earned £12.21/hour now earns 63p/hour more. Over 52 weeks at 37.5 hours: an additional £1,228 gross per year compared with the 2025/26 rate.
Employer compliance: how HMRC detects underpayment
HMRC's NMW compliance team uses Real Time Information (RTI) — the payroll data every employer submits each pay period — to flag where calculated hourly rates fall below NMW. If average reported pay divided by reported hours is below the applicable rate, the employer may receive an inquiry.
Workers can also report employers directly via ACAS (0300 123 1100) or online. Reports are anonymous. If the complaint is upheld, HMRC issues an enforcement notice requiring payment of arrears plus the financial penalty.
The penalty: 200% of total underpayment, capped at £20,000 per worker. The minimum penalty is £100 per worker even for small underpayments. For an employer with 50 staff underpaid by an average of £200 each, the maximum penalty is £20,000 × 50 = £1,000,000.
The name-and-shame list
HMRC publishes a quarterly list of employers who have been found to underpay NMW. Named employers receive significant press coverage and reputational damage. Large employers (household retail names, care home chains) have appeared on this list — demonstrating that compliance checks are not limited to small businesses.
What counts toward NMW (and what doesn't)
Counts toward NMW:
- Basic pay
- Shift or weekend premiums
- Performance bonuses
- The value of accommodation (up to the offset rate: £10.01/day)
Does not count toward NMW:
- Overtime premiums (only the basic element counts)
- Tips and gratuities (as of October 2024)
- Employer pension contributions
- Travel time allowances and expense reimbursements
- Deductions for uniforms or equipment
What the rise means for small businesses
For small businesses with tight margins, a 4.1% NLW increase represents a direct increase in payroll costs. A business employing 10 full-time NLW workers sees annual wage costs rise by approximately:
10 employees × £1,228/year = £12,280/year in additional gross wages. Plus the employer NI on the increase (15% × £1,228 × 10 = £1,842). Total additional cost per 10 employees: ~£14,122/year.
Employer NI relief for small employers (the Employment Allowance of £10,500 in 2026/27) can offset part of this for eligible businesses.
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Calculate employer NI costsSources
- Low Pay Commission: National Minimum Wage — recommendation to government 2026
- HMRC: National Minimum Wage and Living Wage — gov.uk
- HMRC: National Minimum Wage enforcement — gov.uk
- Department for Business and Trade: Employment (Allocation of Tips) Act 2023
- ONS: Annual Survey of Hours and Earnings 2025 — median hourly earnings data
Frequently asked questions
What is the National Living Wage from April 2026?
The National Living Wage (NLW) for workers aged 21 and over is £12.71 per hour from 1 April 2026. This is an increase of 50p (4.1%) from the previous rate of £12.21.
What are the NMW rates for under-21s from April 2026?
From April 2026: aged 18–20 receives £10.00/hour (up from £8.60), aged 16–17 receives £7.55/hour (up from £6.40). The apprentice rate is also £7.55/hour for apprentices in their first year or aged under 19.
How much do NLW workers earn annually?
At £12.71/hour working 37.5 hours per week for 52 weeks: £12.71 × 37.5 × 52 = £24,784 gross per year. Full-time NLW workers earn approximately £476/week or £2,065/month before tax.
What is the take-home pay at NLW full-time in 2026/27?
A full-time NLW worker (37.5 hours, £24,784 gross) earning in 2026/27 would have a net take-home of approximately £20,424 after Income Tax and National Insurance, based on standard tax code 1257L and employee NI at 8%.
Who is responsible for checking NMW compliance?
HMRC's National Minimum Wage compliance team enforces the rules. They investigate complaints from workers, conduct proactive audits, and use Real Time Information (RTI) payroll data to flag employers where average hourly rates appear below the NMW threshold.
What are the penalties for underpaying the minimum wage?
Employers who underpay face a fine of 200% of the underpayment (minimum £100, maximum £20,000 per worker), plus they must repay all arrears. Persistent offenders can be publicly named on the government's NMW name and shame list.
Does the NMW apply to all workers, including gig economy workers?
NMW applies to 'workers', a category that includes employees and many gig economy workers who do not have fixed hours. HMRC and employment tribunals have increasingly found that gig economy workers (Deliveroo couriers, Uber drivers who fall under worker status) are entitled to NMW and holiday pay.
Do tips count toward the minimum wage?
No. Following the Employment (Allocation of Tips) Act 2023 (effective October 2024), tips and gratuities paid by customers cannot be counted toward NMW. Employers must pass 100% of customer tips to workers without deduction.
What is the accommodation offset rate?
If an employer provides accommodation to a worker, they can offset up to £10.01 per day against the NMW. This means a worker in employer-provided accommodation can be paid slightly less than NMW cash — but only up to this capped daily offset rate.
When was the NLW age threshold last changed?
The NLW age threshold was lowered from 25 to 23 in April 2021, and then to 21 in April 2024. There are no current plans to lower the threshold further, though the Low Pay Commission reviews rates and eligibility annually.
Try the calculators
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