Minimum Wage, Statutory Pay and Deduction Thresholds 2024-25

Mar 18, 2024 | National Minimum Wage, Payroll

Minimum Wage, Statutory Pay and Deduction Thresholds 2024-25

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Minimum wage rates change on 1^st April each year so it’s vitally important you are aware of the new rates and ensure you have checked your payroll software is up to date to ensure wages are calculated using the correct rates.

The hourly rate for the minimum wage depends on age and whether you are an apprentice. You must be at least:

school leaving age to get the National Minimum Wage
From 1 April 2024, workers aged 21 and over will be entitled to the National Living Wage – the minimum wage apply for workers aged 20 and under

Minimum Wage

	Rate from 1 April 2023	Rate from 1 April 2024	Increase
National Living Wage (NLW) for workers 21 and over	£10.42	£11.44	9.8%
18-20 year old rate (NMW)	£7.49	£8.60	14.8%
16-17 year old rate (NMW)	£5.28	£6.40	21.2%
Apprentice rate	£5.28	£6.40	21.2%

Personal Allowance & Income Tax

The amount of Income Tax you need to deduct from your employees’ wages depends on how much they earn and how much of their taxable income is above their personal allowance and which tax band it falls into.

Personal Allowance: 0% tax on earning up to £12,570.
The standard tax code is 1257L.
20% tax is due on earnings between £12,571 and £50,270.
40% tax is due on earnings between £50,271 and £125,140.
45% tax is due on earnings more than £125,140.

Emergency tax codes from 6^th April 2024 are as follows:

1257L W1
1257L M1
1257L X

Statutory Pay Rates

From 6^th April 2024 Statutory Sick Pay (SSP) is £116.75 per week, with the amount due based on the number of working days in the week.

From 7^th April 2024 the following statutory payments increase to £184.01 per week or 90% of average weekly earnings (AWE), whichever is the lower:

Statutory Maternity/Adoption Pay – eligible employees will receive up to 39 weeks of SMP/SAP at 90% of their average weekly earnings before tax – for the first 6 weeks of their leave, followed by £184.03 or 90% of their average weekly earnings (whichever is lower) – for the remaining 33 weeks of their leave.

Statutory Paternity Pay
Statutory Shared Parental Pay
Statutory Adoption Pay
Statutory Bereavement Pay

For further information about payroll rates for 2024-2025 visit the government website

National Minimum Wage and National Living Wage rates – GOV.UK (www.gov.uk)

Running your own payroll can be tricky, especially as you have to be sure you’re paying both your employees and HMRC the correct amount. If you’re worried about running payroll, why not outsource? We can take the stress away of payment deadlines and you can be sure you’re paying both your employees and HMRC correctly.

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Payroll rates and thresholds for 2023-24

Mar 21, 2023 | National Minimum Wage, Payroll

Payroll rates and thresholds for 2023-24

It can get quite overwhelming trying to keep up with all the updates when it comes to payroll rates and thresholds for your employees.

We can of course try our best to keep you in the loop with regular updates but if it does get too much as a busy business owner, you can outsource your payroll function. This way you won’t be worried about paying your staff the incorrect rates or stressing that they won’t be paid on time.

But for now here’s the latest information for you to absorb.

Minimum Wage

The minimum wage rate has increased for all brackets this year. Varying from a 40p to £1 increase. The following rates will be applicable from 1st April 2023.

It’s important you take note of these rates and apply them to your employees payroll from 1st April 2023.

It’s important you take note of these rates and apply them to your employees payroll from 1st April 2023.

Income Tax

The amount of tax you need to deduct from your employees wages depends on how much they earn. These are the brackets set by the government along with the rates of tax that they must pay.

Emergency tax codes from April 2023 are as follows:

1257L W1
1257L M1
1257L X

National Insurance

Here are the National Insurance thresholds from April 2023

The amount you should deduct from your employees depends on the above thresholds. If an employee is at or below the lower earning limits then no national insurance should be deducted. If they fall in any of the other categories the following rates apply form April:

Employee Contributions

As well as remembering how much and when to pay your employees, you’ve also got to remember to pay HMRC your employer contributions.

As an employer you also need to make contributions as per below, please note if an employee is at or below the lower earning limit no contributions are required.

Employer Contributions

For further information about payroll rates for 2023-2024 visit the government website – Rates and thresholds for employers 2023 to 2024 – GOV.UK.

>>>find out more at https://www.cactusbookkeeping.uk or book a discovery call using the link below

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Minimum Wage, Statutory Pay and Deduction Thresholds 2022-23

Apr 2, 2022 | All Categories, National Minimum Wage, Payroll

Minimum Wage, Statutory Pay and Deduction Thresholds 2022-23

Minimum Wage Rates

The rates change on 1^st April each year and the hourly rate for the minimum wage depends on your age and whether you are an apprentice.

You must be at least:

school leaving age to get the National Minimum Wage
aged 23 to get the National Living Wage – the minimum wage will still apply for workers aged 22 and under

✻ National Living Wage (aged 23 and over) has increased 6.60% to £9.50 per hour

✻ 21 to 22 will receive a 9.80% rise to £9.18 per hour

✻ 18 to 20 will receive a 4.10% rise to £6.83 per hour

✻ Under 18’s will receive a 4.10% increase to £4.81 per hour

✻ Apprentices will receive a 11.90% rise to £4.81 per hour**

Apprentices are entitled to the apprentice rate if they are:

aged under 19
aged 19 or over and in the first year of their apprenticeship

Example – An apprentice aged 21 in the first year of their apprenticeship is entitled to a minimum hourly rate of £4.81.

Apprentices are entitled to the minimum wage for their age if they both:

are aged 19 or over
have completed the first year of their apprenticeship

Example – An apprentice aged 21 who has completed the first year of their apprenticeship is entitled to a minimum hourly rate of £9.18.

Statutory Pay Rates

Statutory Sick Pay (SSP) is £99.35 per week, with the amount due based on the number of working days in the week.

Statutory Maternity Pay (SMP) and Statutory Adoption Pay (SAP) remains the same at 90% of the employee’s average weekly earnings (AWE) for the first 6 weeks. The statutory weekly rate for all weeks after this will be the lower of 90% of AWE or £156.66.

Statutory Paternity Pay (SPP), Statutory Shared Parental Pay (ShPP) and Statutory Parental Bereavement Pay (SPBP) all have the same weekly rate of £156.66 or 90% of AWE, whichever is lower.

PAYE Rates

Personal Allowance is £12,570 for the year. Employees can earn £1,048 monthly or £242 weekly free of tax

The standard tax code is 1257L

20% tax is due on earnings between £12,571 and £37,700 per year

40% tax is due on earnings between £37,701 and £150,000 per year

45% tax is due on earnings in excess of £150,000 per year

NIC Rates

Employer National Insurance contributions at 15.05% (including 1.25% increase for social care) are due on employee’s earnings over £9,100 per annum, £758 per month or £175 per week

No Employer NI contributions are due on earnings of apprentices under 25, employees aged under 21, or veterans of the Armed Forces in the first 12 months of their civilian employment

Employee National Insurance contributions at 13.25% (including 1.25% increase for social care) are due on their earnings over £9,880 per annum, £823 per month or £190 per week

If you require any further assistance with payroll and compliance, please get in touch via https://www.cactusbookkeeping.uk/contact/

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Increase of National Minimum Wage & National Living Wage Rates – April 2021

May 4, 2021 | All Categories, National Minimum Wage

Increase of National Minimum Wage & National Living Wage Rates – April 2021

The rates change on 1st April each year and the hourly rate for the minimum wage depends on your age and whether you are an apprentice.

You must be at least:

school leaving age to get the National Minimum Wage
aged 23 to get the National Living Wage – the minimum wage will still apply for workers aged 22 and under

The National Living Wage has been extended from those aged 25+ to employees aged 23+.

✻ Aged 23 and over will receive 2.2% rise to £8.91 per hour

✻ Those aged 21 to 22 will receive a 2% rise to £8.36 per hour

✻ Those aged 18 to 20 will receive a 1.7% rise to £6.56 per hour

✻ Under 18’s will receive a 1.5% increase to £4.62 per hour

✻ Apprentices will receive a 3.6% rise to £4.30 per hour**

** Apprentices are entitled to the apprentice rate if they are:

aged under 19
aged 19 or over and in the first year of their apprenticeship
Example – An apprentice aged 21 in the first year of their apprenticeship is entitled to a minimum hourly rate of £4.30.

Apprentices are entitled to the minimum wage for their age if they both:

are aged 19 or over
have completed the first year of their apprenticeship
Example – An apprentice aged 21 who has completed the first year of their apprenticeship is entitled to a minimum hourly rate of £8.36.

If you require any further assistance with regard to NMW and/or NLW please book a free discovery call to chat further.

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ABOUT SUE

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