UK National Living Wage 2027: £13.21 an Hour

The new rates

The government accepted the Low Pay Commission's recommendations in full. Unlike the previous two Budgets — where youth rates rose much faster than the adult rate — every rate moves by the same 3.9% this year, so the gap between the youth and adult rates stays the same.

What £13.21 actually means in a payslip

For a 37.5-hour week (the most common full-time contract in the UK), £13.21 an hour is:

• £495.38 a week
• £2,146.63 a month on a 52-week average
• £25,759.50 a year gross

The Treasury's own estimate is about £910 more a year for a full-time worker. That is before income tax and National Insurance, so the take-home gain is smaller — roughly £730 depending on your tax code.

⚠️ Your overtime rate moves too

UK employers are not required to pay a premium for overtime, but most that do calculate it on the minimum-wage worker's hourly rate. When the NLW rises, that overtime rate has to rise with it.

At £13.21, time-and-a-half is £19.82 an hour and double time is £26.42. On five overtime hours a week that is £99.10 — about £5.15 a week more than at the 2026 rate.

⚠️ Your holiday pay moves too

Holiday pay for irregular-hours and part-year workers is calculated using the 52-week reference period — the average of your last 52 paid weeks. As the new rate feeds into weekly pay, it also feeds into that average, so holiday pay follows automatically. But there is a lag: the 52-week reference period means a rate change in April takes a full year to work through your holiday pay if you are on irregular hours.

For a worker with normal hours, holiday pay is simply their normal weekly pay, so it updates the day the new rate starts.

Why employers should act now, not in April

The Budget was on 28 October 2026 and the new rate applies from 1 April 2027. That is five months to get ready, and most of the work is not the headline rate — it is everything underneath it:

1. Pay differentials. A supervisor paid £13.50 is now only 29p above the floor. Employers almost always end up raising those staff too, so budget for more than the minimum-wage headcount.
2. Salary sacrifice. Pension salary sacrifice, cycle-to-work and childcare vouchers reduce pay. If the sacrifice takes someone below £13.21, that is a national minimum wage breach — and HMRC enforces it, not just the employer.
3. Deductions. Uniform costs, tools, accommodation and training fees can all push pay under the minimum. Only the accommodation offset (£11.53 a day) is allowed.
4. Unpaid working time. Travel between assignments, time spent on training, handover and security checks all count as working time for minimum wage purposes. This is the single most common enforcement finding.
5. Employer National Insurance. Budget on the increased wage bill, not on the current one.

Also in the Autumn Budget 2026

• No change to the headline rates of income tax, National Insurance or VAT.
• Payrolling of benefits in kind becomes mandatory for company cars, vans, fuel and medical benefits from 6 April 2027. All other benefits follow from 6 April 2028.
• Mileage rate: the 55p rate becomes permanent, and the rate above 10,000 miles rises to 35p.
• Paternity pay extended to self-employed fathers and partners — two weeks.
• 670 additional HMRC compliance officers funded, with a focus on accurate payroll and records.

For anyone running payroll, the practical deadline is 6 April 2027 — the same week the new wage rates land, payrolling of benefits starts, and the tax year turns over.

Working out your own figures

Use the holiday pay calculator to see what the new rate does to your holiday pay, or the pro rata calculator if you work part-time.