Autumn Budget 2026 – Minimum Wage increases

by Aitch, posted in Employment & Payroll

The Chancellor of the Exchequer, John Healey, announced increases to the National Living Wage (NLW) and National Minimum Wage (NMW) rates, confirming that the Government has accepted in full the recommendations of the Low Pay Commission (LPC) for increases from 1 April 2027.

The LPC said that it had to balance higher wages for workers with the pressures facing employers. Job vacancies have fallen, and recruitment has been particularly weak in retail and hospitality. The Commission therefore recommended a cautious approach, while ensuring that minimum wage rates continue to rise faster than inflation.

The NLW, which applies to workers aged 21 and over, will increase from £12.71 to £13.21 an hour, a rise of 50p or 3.9%. This represents an annual pay increase of around £910 for someone working full-time and earning the NLW.

The NMW rate for 18 to 20-year-olds will rise from £10.85 to £11.27 an hour, also an increase of 3.9%. The government remains committed to bringing the rate for 18 to 20-year-olds into line with the NLW, but in conjunction with the LPC has paused this process due to slowing demand for young workers and concerns that larger increases could affect youth employment.

The rate for 16 to 17-year-olds will also increase by 3.9%, from £8.00 to £8.31 an hour. The Apprentice Rate will rise to the same level, in line with the LPC’s recommendations.

Source:HM Treasury | 28-10-2026
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Aitch
I'm Aitch, the Founder and CEO of CIGMA Accounting Ltd. As a Chartered Management Accountant and as a CIMA member, I've spent more than 16 years helping businesses, entrepreneurs, landlords, and individuals with tax planning, accounting, and HMRC compliance. As a chartered accountant in London, I'm passionate about making complex tax matters easier to understand and helping clients make confident financial decisions. Over the years, I've advised start-ups, SMEs, established companies, and high-net-worth individuals across a wide range of tax and accounting matters. My expertise includes Corporation Tax, Self-Assessment, Capital Gains Tax, Inheritance Tax planning, R&D tax relief, capital allowances, international tax, and resolving complex HMRC compliance issues. Whether clients need a business accountant, tax accountant, or strategic tax advisor, my focus is always on delivering practical advice that creates long-term value. One of my specialist areas is Making Tax Digital (MTD). I've worked extensively with businesses preparing HMRC's digital reporting requirements, helping them move to cloud accounting, improve financial processes, and adopt technology that makes compliance more efficient. I regularly speak at Making Tax Digital roadshows, industry events, and educational sessions in collaboration with Zoho Books, sharing practical insights into digital accounting, tax legislation, and the future of the profession. Many business owners looking for the best accounting firm in London are not simply searching for an accountant they're looking for trusted advice, responsive support, and long-term value. That's the approach I've taken in building CIGMA Accounting. My team and I work closely with businesses across London and the UK, providing accounting services, tax advisory, bookkeeping, payroll, VAT, company accounts, and strategic tax planning tailored to each client's goals. Through this website, I share practical guidance on UK taxation, Making Tax Digital, HMRC updates, Corporation Tax, Self-Assessment, and business finance. My aim is to provide reliable, straightforward information that helps business owners understand changing regulations, reduce compliance risks, and make informed financial decisions with confidence.
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