What is UK Minimum Wage 2026? Take-Home Pay Explained

What is UK Minimum Wage 2026?

The UK minimum wage is set to rise from April 2026. The National Living Wage (NLW) for workers aged 21 and over will increase to £12.71 per hour, up from £12.21. Younger workers and apprentices are covered by the National Minimum Wage (NMW): £10.85 per hour for 18 to 20 year olds, and £8.00 per hour for under 18s and apprentices. These rates are confirmed by GOV.UK and apply across England, Wales, Scotland and Northern Ireland.

For a full-time employee working 37.5 hours per week, the NLW gives an annual gross salary of £24,785. But what you actually take home after deductions depends on Income Tax, National Insurance, pension contributions and any student loan repayments. This article explains how take-home pay is calculated on the minimum wage in 2026/27.

How Take-Home Pay is Calculated

Your employer deducts Income Tax and National Insurance through PAYE before paying you. The standard tax code for 2026/27 is 1257L, giving you a Personal Allowance of £12,570 – the amount you can earn tax-free. On earnings above that, you pay:

• Income Tax: 20% on earnings from £12,571 to £50,270 (basic rate)
• National Insurance: 8% on earnings from £12,571 to £50,270 (Class 1 employee)

On the NLW at 37.5 hours, your taxable income is £12,215. So Income Tax is £2,443 and National Insurance is £977, leaving take-home pay of £21,364 per year (about £1,780 per month) in England, Wales and Northern Ireland. Use our take-home calculator to see your exact net pay based on your hours and tax code.

Scotland Differences

Scotland sets its own Income Tax bands. For a NLW earner, the first £3,967 of taxable income is taxed at 19% (starter rate) instead of 20%. This saves about £40 per year, giving take-home pay of £21,404 per year (£1,784 per month). The National Insurance rates are the same across the UK.

National Living Wage vs National Minimum Wage

The NLW applies to workers aged 21 and over. Younger workers receive lower NMW rates:

Age group	Hourly rate (Apr 2026)	Annual gross (37.5 hrs)	Approx monthly take-home
21+ (NLW)	£12.71	£24,785	£1,780
18-20	£10.85	£21,158	£1,563
Under 18	£8.00	£15,600	£1,229
Apprentice	£8.00	£15,600	£1,229

Take-home figures assume standard deductions with no pension or student loan. For a detailed breakdown, see our salary data page.

Pension and Student Loan Deductions

Workplace Pension (Auto-Enrolment)

If you are aged 22 or over and earn more than £10,000, your employer must enrol you in a workplace pension. The minimum employee contribution is 5% of qualifying earnings. On the NLW at 37.5 hours, that’s about £103 per month, reducing take-home pay to around £20,623 per year (England/Wales/NI). You can opt out, but you would lose the employer’s 3% contribution.

Student Loans

Most student loan plans have repayment thresholds above NLW earnings. For example:

• Plan 1: £26,900
• Plan 2: £29,385
• Plan 4 (Scotland): £33,795
• Plan 5: £25,000

At 37.5 hours, your gross is £24,785 – below all except Plan 5. If you work 40 hours (£26,437), you would repay 9% of earnings above £25,000, about £129 per year (£10.78 per month). Postgraduate Loan repayments start at £21,000, so 6% applies on earnings above that.

Take-Home Pay Examples

Here are net pay figures for common scenarios (England/Wales/NI, 2026/27, no pension or student loan unless stated):

• NLW, 35 hours/week: £23,132 gross → £20,175 take-home (£1,681/month)
• NLW, 37.5 hours/week: £24,785 gross → £21,364 take-home (£1,780/month)
• NLW, 40 hours/week: £26,437 gross → £22,554 take-home (£1,880/month)
• NLW, 37.5 hours, with 5% pension: £24,785 gross → £20,623 take-home
• NMW 18-20, 37.5 hours: £21,158 gross → £18,753 take-home (£1,563/month)

These figures are estimates for a single person with standard tax code. Actual take-home may vary if you have a different tax code, receive benefits, or have other deductions. Read more salary articles on our site for guidance on tax codes and payslips.

Key Points to Remember

• The UK minimum wage for 2026 is £12.71 per hour for workers aged 21+.
• Take-home pay on the NLW at full-time hours is around £1,780 per month in England, Wales and NI.
• Scotland offers slightly higher take-home due to lower Income Tax on the first slice of earnings.
• Pension contributions and student loans can reduce net pay, but they provide long-term benefits.
• Always check your payslip and official HMRC guidance for your personal situation.

For a personalised calculation, try our take-home calculator or explore topics on minimum wage, tax and pensions.