On 28 October 2026 the government accepted the Low Pay Commission's recommendations and confirmed new minimum wage rates from April 2027. The National Living Wage rises 3.9% to £13.21 an hour, and every other age band and the apprentice rate go up by the same 3.9%. For any business that employs staff, this is a payroll cost you can plan for now rather than discover in April.
This guide sets out the exact new rates for every age group, explains who is entitled to them, works through what the rise actually costs an employer once National Insurance and pension are added, and shows what you should do before the new rates take effect. Every figure is checked against gov.uk.
What are the new minimum wage rates from April 2027?
From April 2027 the National Living Wage for workers aged 21 and over rises from £12.71 to £13.21 an hour, a 50p (3.9%) increase. The 18 to 20 rate, the 16 to 17 rate, the apprentice rate and the accommodation offset all rise by the same 3.9%, following the Low Pay Commission recommendations the government accepted on 28 October 2026.
| Rate | From April 2026 (current) | From April 2027 (new) | Increase |
|---|---|---|---|
| National Living Wage (21 and over) | £12.71 | £13.21 | 50p (3.9%) |
| 18 to 20 year old rate | £10.85 | £11.27 | 42p (3.9%) |
| 16 to 17 year old rate | £8.00 | £8.31 | 31p (3.9%) |
| Apprentice rate | £8.00 | £8.31 | 31p (3.9%) |
| Accommodation offset (per day) | £11.10 | £11.53 | 43p (3.9%) |
The figures are published on GOV.UK, with the live rates kept on the National Minimum Wage and National Living Wage rates page. The accommodation offset is the only benefit in kind that can count towards paying the minimum wage, so if you provide live-in accommodation the daily offset limit matters.
Who gets the National Living Wage and National Minimum Wage?
Almost every worker above school leaving age is legally entitled to at least the minimum wage for their age, including part-time staff, agency workers, casual workers and most apprentices. The National Living Wage applies from age 21. Younger workers get the 18 to 20 or 16 to 17 rate, and first-year apprentices under 19 (or any age in year one of an apprenticeship) get the apprentice rate.
The rate is a legal floor, not a target, and it is set per hour even when you pay a salary or piece rate. The genuinely self-employed, company directors with no contract of employment, and some family members working in a family business are outside the rules. If you are not sure whether someone is a worker or self-employed, our guide to employee or self-employed status explains how HMRC draws the line.
What counts as working time for the minimum wage?
Pay is averaged across a pay reference period, so time spent training, travelling between jobs, and waiting on shift usually counts, while ordinary commuting and unpaid breaks do not. Underpayment often happens by accident, through unpaid pre-shift setup, uniform costs that drag pay below the floor, or wrong age-band rates after a birthday. Our guide to night-shift and clock-change pay covers how averaging works when hours move.
How much more will the April 2027 rise cost employers?
For a full-time worker on the National Living Wage, the 50p rise adds about £975 a year in gross pay, and the true cost is higher once employer National Insurance and pension contributions are added on top. On a 37.5 hour week over 52 weeks (1,950 hours), pay goes from £24,784.50 to £25,759.50, a £975 increase per worker before on-costs.
| Cost per full-time NLW worker | From April 2026 | From April 2027 |
|---|---|---|
| Gross annual pay (1,950 hours) | £24,784.50 | £25,759.50 |
| Extra employer NIC on the £975 rise (15%) | – | £146.25 |
| Extra pension on the rise (3%, illustrative) | – | £29.25 |
| Total extra cost of the rise | – | ≈£1,150 |
Employer (secondary) National Insurance is charged at 15% on earnings above the £5,000 secondary threshold, so almost all of the pay rise attracts employer NIC on top, as explained in our guide to employers' National Insurance for 2026/27. Add automatic enrolment pension contributions and the cash cost of a 50p rate rise is closer to £1,150 a year per worker, or around £11,500 across a team of ten. If you are taking on staff for the first time, our guide to hiring your first employee walks through the full on-cost picture.
When do the new rates take effect and what should employers do now?
The new rates apply to the first full pay reference period that starts on or after 1 April 2027, not to pay earned before that date. That gives employers roughly five months to budget, check which staff sit near the floor, and review pricing, so the change does not land unplanned in the April payroll run. Getting the date and the age bands right is the whole compliance task.
Practically, review every worker's hourly rate against their April 2027 age band, flag anyone turning 18 or 21 during the year, and check that deductions such as uniforms or tools do not pull pay below the legal floor. Running this through compliant payroll software removes most of the risk, and our payroll service handles the rate changes, auto-enrolment and real-time reporting for employers. Dedicated support for limited companies keeps the wider cost planning joined up. Want to talk the numbers through first? Book a free call and we will model the April rise for your team.
How do I stay compliant with minimum wage rules?
HMRC enforces the minimum wage and can issue penalties of up to 200% of the arrears plus name offending employers publicly, even where underpayment was unintentional. Keep pay records for at least six years, apply the new age-band rate from the first pay period on or after 1 April 2027, and review salaried staff whose hours push their effective hourly rate below the floor. Our guide to running payroll for a UK company sets out the full employer checklist.
Frequently asked questions
What is the National Living Wage from April 2027?
From April 2027 the National Living Wage for workers aged 21 and over is £13.21 an hour, up from £12.71. That is a 50p increase, worth 3.9%, which the government confirmed on 28 October 2026 after accepting the Low Pay Commission's recommendations. The new rate applies to the first pay period starting on or after 1 April 2027.
What are the minimum wage rates for under 21s in 2027?
From April 2027 the 18 to 20 year old rate rises to £11.27 an hour, and the 16 to 17 rate and the apprentice rate both rise to £8.31 an hour. Each is a 3.9% increase in line with the National Living Wage. Apprentices aged 19 and over move to the age-appropriate rate once they have completed the first year of their apprenticeship.
When do the new minimum wage rates start?
The new rates take effect for the first full pay reference period that begins on or after 1 April 2027. Pay earned before that date stays on the old rate, even if it is paid in April. So a monthly payroll with a period starting on 1 April applies the new rates straight away, while one running mid-month changes at the next period.
How much will the minimum wage rise cost my business?
A 50p rise adds roughly £975 a year in gross pay for each full-time National Living Wage worker on a 37.5 hour week. Once employer National Insurance at 15% and automatic enrolment pension are added, the true cost is closer to £1,150 a year per worker, or about £11,500 for a team of ten. Budget for the on-costs, not just the headline rate.
