Your Questions Answered by TaxAssist Accountants

National Minimum Wage

The National Living Wage increased by 6.2% from £8.21 to £8.72 per hour in April 2020. For each member of staff working full time, this increase could cost an employer on average of over £930 per year. Workers aged 25 or over and who are not in the first year of an apprenticeship, are legally entitled to the National Living Wage.

National Minimum Wage Rates

The National Minimum Wage rates from April 2020 increased as stated below:

  • A 6.5% increase from £7.70 to £8.20 for 21-24 year olds
  • A 4.9% increase from £6.15 to £6.45 for 18-20 year olds
  • A 4.6% increase from £4.35 to £4.55 for Under 18s
  • A 6.4% increase from £3.90 to £4.15 for Apprentices

The new rate will apply to the next pay reference period that begins on or after the date:

  • a rate increase begins
  • an employee reaches a new age bracket.

For example:

An employee paid on the 25th of each month will start to receive the new rate of minimum wage from 26th April onwards as this is the start of the pay reference period beginning after the increase.

Information supplied by Cheryl Hopkins, Chartered Certified Accountant, TaxAssist Accountants. Advice shared in this article is intended to inform rather than advise. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action, as a result of reading this item, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.