National Living Wage
The legally required minimum hourly rate that employers must pay workers aged 21 and over, set at £12.71 per hour from 1 April 2026 (up from £12.21). Younger workers and apprentices have lower statutory minimums known as the National Minimum Wage. The National Living Wage is set annually by the government following recommendations from the Low Pay Commission.
How it works
The National Living Wage applies only to workers aged 21 and over — it isn't a general 'minimum wage for everyone' but the top tier of a wider set of statutory minimum rates that also cover younger workers and apprentices at lower hourly rates under the National Minimum Wage banner. Employers must pay at least the applicable rate for every hour actually worked, including most forms of paid overtime.
The rate is reviewed and typically changes every 1 April, following recommendations from the independent Low Pay Commission, which considers economic conditions, inflation, and the impact on employment when setting its proposed figure for government approval. Because the rate changes on 1 April, separately from the 6 April start of the tax year, payroll systems need to track two different annual change dates for pay and tax purposes.
Underpaying the National Living Wage is a legal breach, not just a tax matter — HMRC enforces minimum wage compliance separately from its normal tax collection role, and can name and shame non-compliant employers publicly as well as ordering repayment of arrears and imposing penalties.
Example: Weekly and annual pay at the National Living Wage
Suppose a worker aged 25 works 35 hours a week at the National Living Wage of £12.71 per hour (from 1 April 2026): 35 × £12.71 = £444.85 a week.
Over a 52-week year, that's £444.85 × 52 = £23,132.20 in gross pay, before any income tax or National Insurance deductions.
Frequently asked questions
Is the National Living Wage the same as the National Minimum Wage?
Not quite — the National Living Wage is the specific rate for workers aged 21 and over, while the National Minimum Wage is the umbrella term covering the lower rates that apply to younger workers and apprentices.
When does the National Living Wage rate change each year?
It changes on 1 April, which is different from the 6 April start of the tax year used for income tax and National Insurance, so payroll systems need to track two separate annual change dates.
What happens if an employer pays below the National Living Wage?
HMRC can investigate, order the employer to repay arrears to affected workers, issue financial penalties, and in serious or repeated cases publicly name the employer as non-compliant.
Related Terms
Taxable Income
The portion of your total income that is actually subject to income tax after deducting the Personal Allowance and any other reliefs or deductions you are entitled to.
PAYE
Pay As You Earn — the system by which employers deduct income tax and National Insurance directly from employees' wages before paying them, and remit the deductions to HMRC on their behalf.