What Is Minimum Wage Per Year in the UK? 2026/27 Guide for Job Seekers

What Is Minimum Wage Per Year in the UK? 2026/27 Guide for Job Seekers

If you're negotiating a job offer or comparing salaries, knowing what is minimum wage per year is essential. The statutory minimum sets a floor, but understanding how much you'll actually take home after deductions helps you evaluate whether an offer meets your needs. This guide uses the latest 2026/27 rates from GOV.UK to break down gross pay, tax, National Insurance, and net income for workers on the National Living Wage and National Minimum Wage.

National Living Wage and National Minimum Wage Rates for 2026/27

From 1 April 2026, the National Living Wage (for workers aged 21 and over) rises to £12.71 per hour. Younger workers and apprentices have separate rates:

• Aged 21 and over (National Living Wage): £12.71/hour
• Aged 18 to 20: £10.85/hour
• Under 18 (above compulsory school age): £8.00/hour
• Apprentices (under 19, or 19+ in first year): £8.00/hour

These rates are set by the Low Pay Commission and apply across the UK. The annual gross salary depends on your contracted hours. For a typical full-time week of 37.5 hours (including paid holiday), the annual gross is:

• 35 hours/week: £23,132.20
• 37.5 hours/week: £24,784.50
• 40 hours/week: £26,436.80

For an 18-20 year old working 37.5 hours at £10.85/hour, the annual gross is £21,157.50. For an apprentice or under-18 worker at £8.00/hour, it's £15,600.

Take-Home Pay: What You Actually Earn

Your take-home pay (net pay) is your gross salary minus Income Tax, employee National Insurance, and any other deductions like pension contributions or student loan repayments. Using the standard tax code 1257L (Personal Allowance of £12,570), here's how the deductions work for a worker on the National Living Wage at 37.5 hours/week:

• Gross annual pay: £24,784.50
• Income Tax: 20% on earnings above £12,570 = 20% of £12,214.50 = £2,442.90
• Employee National Insurance: 8% on earnings above £12,570 = 8% of £12,214.50 = £977.16
• Take-home pay: £24,784.50 - £2,442.90 - £977.16 = £21,364.44 per year (about £1,780.37 per month or £410.85 per week)

If you work 40 hours/week, your annual gross is £26,436.80, tax is £2,773.36, NI is £1,109.34, and take-home is £22,554.10 (about £1,879.51 per month).

Scotland's Different Tax Bands

Scotland uses its own Income Tax rates. For a minimum wage earner, the first £3,967 of taxable income is taxed at 19% (starter rate) rather than 20%. This means slightly less tax: on £24,784.50, Scottish tax would be about £2,403.23 instead of £2,442.90, giving take-home of around £21,404.11 (about £1,783.68 per month).

Student Loan Repayments

Most student loan plans have thresholds above the National Living Wage. Plan 1 (£26,900), Plan 2 (£29,385), and Plan 4 (£33,795) are all above £26,436.80, so no repayments are due. However, Plan 5 (introduced for English students starting from 2023) has a threshold of £25,000. If you work 40 hours/week (£26,436.80), you repay 9% of the excess (£1,436.80) = £129.31 per year (about £10.78 per month). At 37.5 hours, you're below the threshold, so no Plan 5 repayment. Postgraduate Loan repayments start at £21,000, so 6% applies on earnings above that. For a 37.5-hour NLW worker, that's 6% of £3,784.50 = £227.07 per year (about £18.92 per month).

Comparing Job Offers: Minimum Wage vs Median Salary

Knowing what is minimum wage per year helps you benchmark offers. The UK median full-time gross annual pay is around £39,039 (based on ONS data). That's about £14,254 more than the NLW at 37.5 hours. The take-home on the median salary (assuming same deductions) is roughly £31,632 per year (about £2,636 per month) – a significant difference.

When comparing job offers, consider:

• Hourly rate vs annual salary: Some jobs quote hourly rates, others annual. Convert to a common figure using your expected hours.
• Contracted hours: Minimum wage jobs often offer fewer than 37.5 hours; check your contract.
• Benefits: Pension contributions, overtime, bonuses, and health insurance add value beyond the base pay.
• Location: Scotland's lower tax on low earners can make a small difference.

Use our salary articles for more on negotiating, and try the take-home calculator to model different scenarios including pension and student loans.

Factors That Affect Your Take-Home Pay

The figures above assume no pension contributions, no student loan (except where noted), and standard tax code. In reality:

• Workplace pension: If you're auto-enrolled, you contribute at least 5% of qualifying earnings (usually above £6,240). This reduces take-home but builds retirement savings.
• Tax code changes: If you have benefits in kind (e.g., company car) or multiple jobs, your Personal Allowance may be lower.
• Married or civil partner allowances: Some couples can transfer allowances.
• Other deductions: Union fees, charitable giving via payroll, or court orders.

Always check your payslip and official GOV.UK guidance for your personal situation.

How to Use This Information When Negotiating

When you receive a job offer, ask for the hourly rate and contracted weekly hours. Calculate the annual gross and then estimate take-home using the steps above. If the offer is at or near the minimum wage, remember that the statutory rate is a floor – many employers pay more, especially in sectors with labour shortages. Use the knowledge of what is minimum wage per year to argue for a higher rate if you have experience or skills.

For more data on typical salaries by industry and region, visit our salary data page. And if you're comparing multiple offers, the take-home calculator lets you input different salaries, hours, and deductions to see the net difference.

Frequently Asked Questions

What is the minimum wage per year for a full-time worker in 2026/27? For a worker aged 21 and over on the National Living Wage of £12.71 per hour, working 37.5 hours per week (52 weeks), the annual gross salary is £24,784.50. If working 40 hours per week, it rises to £26,436.80. For 18-20 year olds at £10.85/hour, the annual gross is £21,157.50 (37.5 hours). These are statutory minimums; many employers pay more.

How much take-home pay can I expect on the National Living Wage? On the NLW at 37.5 hours/week, after Income Tax (20% on earnings above £12,570) and employee National Insurance (8% on earnings above £12,570), your annual take-home pay is approximately £21,364.44, which is about £1,780 per month. In Scotland, the starter rate of 19% on the first £3,967 of taxable income reduces tax slightly, giving around £1,784 per month. If you have a student loan or pension contributions, take-home will be lower.

Does the minimum wage differ in Scotland? The hourly minimum wage rates are the same across the UK (set by UK Government). However, Scotland has different Income Tax bands. For a minimum wage earner, the Scottish starter rate (19%) on the first £3,967 of taxable income means you pay slightly less tax than in England and Wales, where the basic rate (20%) applies from the first pound above the Personal Allowance. This results in a marginally higher take-home pay in Scotland at this income level.