What Is the UK Minimum Wage in 2026? Gross Pay, Take-Home and Key Deductions Explained

What Is the UK Minimum Wage? The 2026/27 Rates

If you are wondering what is the UK minimum wage for the coming tax year, the answer depends on your age and whether you are an apprentice. From 1 April 2026, the main rate – known as the National Living Wage – for workers aged 21 and over increases to £12.71 per hour. This is a 4.1% rise from the previous £12.21, following recommendations by the Low Pay Commission. GOV.UK National Living Wage rates confirm the new rates.

For younger workers, the rates are:

• 18 to 20 year olds: £10.85 per hour (up 8.5%)
• 16 to 17 year olds: £8.00 per hour (up 6%)
• Apprentices (under 19, or 19+ in first year): £8.00 per hour (up 6%)

These are legal minimums – you cannot be paid less than the rate that applies to you. Employers must also ensure that your average hourly pay (including overtime and tips in some cases) meets the minimum.

Gross Salary vs Take-Home Pay: What Comes Off?

Your gross salary is the amount you are paid before any deductions. Your take-home pay (net pay) is what actually lands in your bank account after the following are taken off through PAYE:

• Income Tax – based on your tax code and taxable earnings above your Personal Allowance.
• National Insurance (NI) – employee contributions on earnings above the primary threshold.
• Pension contributions – if you are enrolled in a workplace pension (automatic enrolment).
• Student loan repayments – if you have a Plan 1, 2, 4, 5 or Postgraduate Loan.

Income Tax in 2026/27

For England, Wales and Northern Ireland, the standard Personal Allowance is £12,570 per year. Earnings above that are taxed at:

• 20% on the next £37,700 (basic rate)
• 40% on earnings from £37,701 to £125,140 (higher rate)
• 45% above £125,140 (additional rate)

Scotland’s Different Bands

If you live in Scotland, the Personal Allowance is the same (£12,570) but the tax bands are different:

• 19% on the first £3,967 of taxable income (starter rate)
• 20% on £3,968 to £16,956 (basic rate)
• 21% on £16,957 to £31,092 (intermediate rate)
• 42% on £31,093 to £62,430 (higher rate)
• 45% on £62,431 to £125,140 (advanced rate)
• 48% above £125,140 (top rate)

Because the starter rate is lower than 20%, someone on the National Living Wage in Scotland pays slightly less Income Tax than elsewhere in the UK.

National Insurance (Employee)

For most employees (category A), you pay:

• 0% on earnings between £6,708 (lower earnings limit) and £12,570 (primary threshold)
• 8% on earnings between £12,570 and £50,270 (upper earnings limit)
• 2% on earnings above £50,270

These thresholds are per year. The primary threshold aligns with the Personal Allowance, so both Income Tax and NI start at the same point.

Take-Home Pay on the National Living Wage: Worked Examples

Let’s see what what is the UK minimum wage means in practice for your pocket. All figures use the standard 1257L tax code, category A NI, and assume no pension or student loan deductions.

37.5 Hours per Week (common full-time contract)

• Annual gross: £12.71 × 37.5 × 52 = £24,784.50
• Income Tax: 20% on (£24,784.50 – £12,570) = £2,442.90
• National Insurance: 8% on (£24,784.50 – £12,570) = £977.16
• Take-home pay: £21,364.44 per year / £1,780.37 per month / £410.85 per week

That works out to an effective hourly rate after deductions of about £10.96.

40 Hours per Week

• Annual gross: £12.71 × 40 × 52 = £26,436.80
• Income Tax: 20% on (£26,436.80 – £12,570) = £2,773.36
• National Insurance: 8% on (£26,436.80 – £12,570) = £1,109.34
• Take-home pay: £22,554.10 per year / £1,879.51 per month

18-20 Year Old Rate (37.5 hours)

At £10.85 per hour:

• Annual gross: £21,157.50
• Income Tax: 20% on (£21,157.50 – £12,570) = £1,717.50
• NI: 8% on (£21,157.50 – £12,570) = £687.00
• Take-home: £18,753.00 per year / £1,562.75 per month

Under 18 / Apprentice Rate (37.5 hours)

At £8.00 per hour:

• Annual gross: £15,600.00
• Income Tax: 20% on (£15,600 – £12,570) = £606.00
• NI: 8% on (£15,600 – £12,570) = £242.40
• Take-home: £14,751.60 per year / £1,229.30 per month

How Student Loans Affect Take-Home Pay

Most student loan plans have thresholds above the National Living Wage, so many minimum wage workers won’t repay anything. However:

• Plan 5 (post-2023 English students) has a threshold of £25,000 per year. At 40 hours/week (£26,436.80), you repay 9% on the £1,436.80 above the threshold: about £129 per year (£10.78 per month). At 37.5 hours, you are below the threshold so no repayment.
• Postgraduate Loan threshold is £21,000 per year. At any NLW hours above 37.5, you repay 6% on earnings above £21,000. For 37.5 hours (£24,784.50), that’s 6% of £3,784.50 = £227 per year (£18.92 per month).

These deductions come off your take-home pay after tax and NI.

Pension Contributions

If you are automatically enrolled into a workplace pension, you typically contribute at least 5% of your qualifying earnings (above £6,240 per year). Your employer adds at least 3%. Using salary sacrifice, pension contributions reduce your taxable pay, so you save Income Tax and NI on the amount you sacrifice. For a detailed breakdown, see our salary articles or use the take-home calculator to model your exact situation.

How the Minimum Wage Compares to Median Pay

To give context, the UK median full-time gross annual salary is around £39,039 (based on ONS ASHE data). That is about 57% higher than the NLW at 37.5 hours. The median worker takes home roughly £2,636 per month after tax and NI, compared to £1,780 for the minimum wage. This gap reflects differences in skill, experience and occupation.

Key Takeaways

• What is the UK minimum wage? For most adults, it’s £12.71 per hour from April 2026.
• Gross vs net: Your take-home is significantly lower due to Income Tax and NI – roughly 86% of gross at the NLW level.
• Scotland: Slightly lower tax at this income level, adding about £3-4 per month.
• Student loans: Only Plan 5 and Postgraduate Loan typically affect NLW earners working full-time hours.
• Pension: If you opt in, your take-home will be lower but you build retirement savings.

For more detailed analysis and to check your own figures, visit After Tax Salary. You can also explore our salary data for comparisons across roles and regions.

Remember: the figures here are estimates for a single person with standard allowances. Your actual take-home pay depends on your tax code, pension choices, student loan plan, and any other deductions. Always check your payslip and refer to official GOV.UK guidance.