The National Living Wage rises to £13.21 an hour from 1 April 2027, up 50p (3.9%) from £12.71, after the government accepted the Low Pay Commission's advice in full on 28 October 2026. For a 35-hour week, that's £910 a year more before deductions. But what actually reaches your bank account can be much smaller. In our three illustrative households, the real yearly gain ranges from £702 down to £295, depending on hours, tax and Universal Credit.
Every new rate from April 2027
| Rate | April 2026 | April 2027 | Rise |
|---|---|---|---|
| National Living Wage (21 and over) | £12.71 | £13.21 | +50p |
| 18–20 year olds | £10.85 | £11.27 | +42p |
| 16–17 year olds | £8.00 | £8.31 | +31p |
| Apprentice rate | £8.00 | £8.31 | +31p |
| Accommodation offset (per day) | £11.10 | £11.53 | +43p |
The new rates apply from the first pay reference period that starts on or after 1 April 2027. If you're paid monthly from the 16th, for example, the higher rate may not appear until the period starting 16 April. The Low Pay Commission says £13.21 is above the range of inflation forecasts for April 2027 to March 2028, but still below its reference point of two-thirds of median earnings, which would have meant £13.44.
Gross pay by hours worked
52 paid weeks a year at £12.71 and £13.21. Bars show the size of the yearly rise.
Three households, one year (illustrative examples)
To see what's left after deductions, we follow three illustrative workers through April 2027 to March 2028. The income tax personal allowance and the National Insurance threshold are frozen at £12,570 until 5 April 2031, so for anyone already earning above £12,570, every extra pound is taxed at 20% plus employee NI (8% at current rates). That's 28p of each £1.
Household 1 · Shona, 41, full-time care worker
37.5 hours a week, no benefits. Gross rise: £975. Less 20% tax and 8% NI (£273): £702 a year, about £58.50 a month. If she pays 5% into a workplace pension, around £49 of the rise goes to her pension rather than her pocket. That's still her money, just later.
Household 2 · Dani, 33, single parent on Universal Credit
35 hours a week in retail and already earning above her work allowance. Gross rise: £910. After tax and NI: £655.20. Universal Credit then reduces by 55p for every extra £1 of take-home pay, which is £360.36. She keeps £294.84 a year, about £24.57 a month.
Household 3 · Lorraine, 58, part-time in hospitality
20 hours a week, no benefits. Her pay is just over the £12,570 threshold both before and after the rise, so all of the £520 gross rise is taxed: £374.40 a year, about £31.20 a month.
A 50p headline rise can become about 16p of extra spending money per hour for a full-time worker on Universal Credit. Knowing your real number is the whole game.
Give your pay rise a job before April
£24.57 or £58.50 a month disappears fast unless it's given a purpose before it arrives. The Matriarch Money Dashboard shows you where the new money goes, month by month.
- Enter your new April pay once and see it flow through your bills, buffer and goals
- Track rising bills against your rise, so you know whether you're really ahead
- Monthly overview charts that make a £25–£60 difference visible
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Checklist before 1 April 2027
- Find your pay reference period. Ask payroll when your first payslip at £13.21 will arrive.
- Check your age band. Turning 21 before April? You move from £11.27 to £13.21, a 17% jump.
- Check deductions for uniforms or equipment. These can push your effective pay below the minimum. HMRC enforces it, and Acas gives free advice.
- Universal Credit claimants: report earnings changes as usual. Expect the higher pay to reduce your award in the next assessment period, so plan around the net figure above, not the 50p.
- Pick the job for the extra money before it arrives, whether that's a bill buffer, debt or savings.
For the benefit side of April 2027, see Benefit Rates 2027/28: Every New Amount. To check your rise against prices, read UK Inflation October 2026: 3 Households If It Hits 5% and Energy Price Cap January 2027: Your Bill by Size. If you have a student loan, Student Loan Repayments 2026/27: 3 Women, One Payslip shows how repayments take a slice too.
Young workers: what 42p adds up to
This year every band rises by the same 3.9%. In April 2026 the 18–20 rate rose 8.5%, so the gap with the adult rate is closing more slowly now. For a 19-year-old working 25 hours a week, the 42p rise adds £546 a year before deductions (£10.85 to £11.27 an hour). If they live at home and pay board, agree now whether the board goes up in April, so the rise isn't spent twice.
What it costs employers, and why that matters to you
For a 35-hour worker, the employer also pays more employer National Insurance on the rise, around £136.50 a year on top of the £910 according to payroll specialists' estimates, before any Employment Allowance. In sectors like care, retail and hospitality, some employers respond by trimming hours rather than headcount. If your hours are cut from 37.5 to 35 a week, you lose 2.5 hours at £13.21, about £1,717 a year of gross pay. That's more than the whole £975 rise. If your rota is under review, ask for any change to your contracted hours in writing, and get free advice from Acas before agreeing to anything.
FAQ
What will the minimum wage be in April 2027?
£13.21 an hour for workers aged 21 and over, £11.27 for 18–20 year olds, and £8.31 for 16–17 year olds and apprentices, from 1 April 2027.
How much more will I earn a year on £13.21?
Before deductions, £520 at 20 hours a week, £910 at 35 hours and £975 at 37.5 hours. If you already earn above £12,570, expect to keep about 72p of each extra pound after tax and NI.
Will the pay rise reduce my Universal Credit?
Yes, if you're above your work allowance. Universal Credit falls by 55p for every extra £1 of take-home pay. Use a benefits calculator or ask Citizens Advice to check your own figures.
Sources
- GOV.UK, “LPC recommendations take the National Living Wage to £13.21”, 28 Oct 2026 – gov.uk
- Low Pay Commission, advice to government on 2027 minimum wage rates, 28 Oct 2026 – gov.uk
- HM Treasury/HMRC, maintaining income tax and NIC thresholds until 5 April 2031 – gov.uk
- GOV.UK, Universal Credit: how your wages affect your payments – gov.uk
- The Employment Law Solicitors, “National Living Wage 2027: Budget Confirms £13.21”, 8 Nov 2026 – theemploymentlawsolicitors.co.uk
- MoneyHelper, free money guidance – moneyhelper.org.uk
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Educational content only. Not personalised financial advice.