Payroll changes from April 2026
National Minimum Wage
National Minimum Wage
The National Living Wage (over 21yrs) and the National Minimum Wage will be increased as of 1st April 2026.
Apprentice | Under 18 | 18 to 20 | 21 and over | |
April 2025 | £7.55 | £7.55 | £10.00 | £12.21 |
April 2026 | £8.00 | £8.00 | £10.85 | £12.71 |
Good to know
If your pay period runs across the 1st April (for instance you pay employees on 20th April but their pay relates to 15th March to 16th April), the increase should be applied in the following pay run, so for the 16th April to 15th May pay run.
National Living Wage for Salary Sacrifice Pension
National Living Wage for Salary Sacrifice Pension
If your employees are being paid near to minimum wage, you will need to ensure any salary sacrifice pension deduction doesn’t take them below this. Here is an table of the minimum requirements for hourly/annual paid employees from 1st April 2026. The figures allow for a 5% employee salary sacrifice pension contribution to be appied without taking them below the National Living Wage.
Pensionable pay basis: Qualifying Earnings? | Hourly National Living Wage (over 21) | Min hrly rate for a 5% pension deduction | Min annual salary for a 5% pension deduction 40 hr week | Min annual salary for a 5% pension deduction 37.5hr week |
Yes | £12.71 | £13.23 | £27,593 | £25,868 |
No | £12.71 | £13.38 | £27,906 | £26,162 |
Tax and National Insurance Thresholds
Tax and National Insurance Thresholds
There are no changes to the tax and NI thresholds for 2026/27
Band | Taxable Income | Employee Income Tax Rate | Employee National Insurance Rate | Taxable Income | Employer National Insurance Rate | |
Personal allowance | Up to £12,570 | 0% | 0% | Up to £5,000 | 0% | |
Basic rate | £12,571 to £50,270 | 20% | 8% | Over £5,000 | 15% | |
Higher rate | £50,271 to £125,140 | 40% | 2% |
|
| |
Additional rate | over £125,140 | 45% | 2% |
|
How to easily share your Employer NIC savings with your Employees
How to easily share your Employer NIC savings with your Employees
If your company is currently offering, or are considering a workplace salary sacrifice pension scheme, you may wish to share all/some of your employer NIC savings with your employees by uplifting your employer pension contribution. If you want to share 100% of your savings, some payroll software will have enablement to calculate this automatically for you but others require a manual calculation, especially if you want to share a reduced percentage. To reduce the admin burden, we have created a table showing how you can easily share your savings by simply adjusting your employer contribution percentage. Please share this with your payroll team if this is of relevance to you.
The table below reflects the percentage increase to your current employer contribution to share your NIC savings. The percentage of increase will depend on your employee’s current contribution percentage.
For example, you want to share 75% of your employer NIC savings with your employees, and your current contribution is 3% and employees is 5%: Your new contribution will be 3.56%
Employee contribuion | Share 100% | Share 75% | Share 50% | Share 25% |
6% | 0.90% | 0.68% | 0.45% | 0.23% |
5% | 0.75% | 0.56% | 0.38% | 0.19% |
4% | 0.60% | 0.45% | 0.30% | 0.15% |
Benefit Reporting (P11D & Payrolling Benefits)
Benefit Reporting (P11D & Payrolling Benefits)
If you are an employer who provided a benefit-in-kind to your employees from 6th April 2025 to 5th April 2026, you’ll need to know if a P11D or P11D(b) submission is required. If so, you’ll need to submit this to HMRC by 6th July 2026. Click the link below to explain more and see the tax reporting requirements for Mintago Benefits offered throughout 2025/26. Note some of these offerings are no longer available for the 2026/27 tax year.
End of Year Steps - if you already payroll benefits:
The benefit will have been included in your employee payslips in each pay period to attract income tax only during 2025/26.
Check if you have provided any other benefits to your employees outside of payroll such as medical insurance.
Click the Tax Reporting Requirements link below to see which benefits require reporting. If you are unsure, check HMRCs website for guidance or reach out to the Mintago Team if one of our providers.
Submit a P11D to declare income tax for your emploees if you have not already included any reportable benefits on your payslips.
Submit a P11D(b) to declare to HMRC your Employers Class 1A NIC liability. Include all benefits provided outside of your payroll and those included on the payslips.
End of Year Steps - If not payrolling benefits:
Click the table Tax Reporting Requirements link below to see if you need to report any benefits to HMRC. If you are unsure, check HMRCs website for guidance or reach out to the Mintago Team if one of our providers.
Submit a P11D to declare income tax for your emploees if you have not included a reportable benefit on your payslips.
Submit a P11D(b) to declare your Employers Class 1A NIC liability
The Future of P11D Reporting
The Future of P11D Reporting
P11D and P11D(b) submissions are still required for the tax years 2025/26 and 2026/27. From April 2027, HMRC will require all employers to payroll their benefits to include an Employers Class 1A liability. This means all benefits in kind will be included for tax and E'rs NI on your employees payslips in each pay period. The finer details of how this will be rolled out are yet to be finalised by HMRC - We'll keep you updated!
Statutory Sick Pay
Statutory Sick Pay
From April 2026, Statutory Sick Pay (SSP) will increase and will also become a day-one entitlement. This change removes the waiting period, which is currently three days, down to zero. The lower earnings limit for entitlement to SSP will be totally removed from £125p/w to zero. This will help lower earners during times of sick leave.
Employer Key Actions
Ensure your HR Team are aware of the changes
Review your sick pay policies
Update contracts and/or Employee Handbooks, removing reference to waiting days and lower earning levels
Review budgets
If you have employees whose SSP period includes before and after the start of the new tax year, their payment will need to increase from £118.75 to £123.25p/week from, and including, 6th April. Employees who are within their 3-day waiting period on 6th April will be entitled to SSP from 6th April onwards.
Description | 2025/26 | 2026/27 changes |
Earnings threshold | Earn over £125 p/wk | No threshold - all eligible |
Waiting days | 3 unpaid days | None - SSP from day one |
SSP Rate | £118.75 p/wk | £123.25 p/wk or lower of 80% of average earnings |
Statutory Maternity/Paternity leave
Statutory Maternity/Paternity leave
When paying any of the following, the statutory weekly rates increase from £187.18 to £194.32. To qualify for statutory pay, the lower earnings levels are increased from £125p/wk to £129p/wk.
Statutory Maternity Pay
Statutory Paternity Pay
Statutory Adoption Pay
Shared Parental Pay
Statutory Parental Bereavement Pay
Statutory Neonatal Care Pay
Good to know: If your employees don’t meet the qualifying criteria, you will need to complete the appropriate form (SMP1/SPP1/SPA1/SPBP1/NEO1) and pass this to your employee.
Student Loans
Student Loans
There is a new student loan Plan 5 and from April 2026 repayment thresholds for most loan plans are increasing by 3.2%.
Uni dates | Loan Type | Earnings Threshold | Rate of repayment |
1 Sept 1998 to 30 Aug 2012 | Plan 1 | £26,900 | 9% |
1 Sept 2012 to 31 July 2023 | Plan 2 | £29,385 | 9% |
From 1 Sept 1994 (Scottish Students) | Plan 4 | £33,795 | 9% |
From 1 August 2023 | Plan 5 | £25,000 | 9% |
Postgraduate | £21,000 | 6% |
New Starter Checklist
New Starter Checklist
For new starter details, please use the online starter checklist form available on HMRCs site. There will soon be an update to the current form and we will update these links to reflect 2026 as soon as it's available.
Starter Checkist Online form (2025 form)
Starter Checklist PDF: (2025 form)
Pension Annual Allowance
Pension Annual Allowance
The amount of tax relief you can receive on your pension each year is remaining the same for 2026/27. The Annual Allowance is currently £60,000 and this amount includes the employer's contribution. You may be eligible to carry over unused allowance from the past three years if you were a pension scheme member during that time.
Employment Allowance
Employment Allowance
There are no changes to the annual Employment Allowance of £10,500 and generally all employers are eligible for this with some minor exceptions. This must be claimed via a submission directly from your payroll software each year so ensure your payroll provider claims this for you.
Small Employers Relief
Small Employers Relief
This remains at a £45,000k threshold. This means that employers who paid less than £45,000 in Class 1 National Insurance (ignoring reductions such as the Employment Allowance) in the last full tax year, qualify to claim 100% of statutory payments (not SSP) plus an additional 9% compensation. These claims are made via your payroll software.
Handy Contacts
Handy Contacts
HMRC Employers Helpline 0300 200 3200
HMRC Employers Payment queries: 0300 200 3814
HMRC Employees Helpline 0300 200 3300
ACAS: 0300 123 1100
Mintago: csm@mintago.com
