Employing in the United Kingdom.

Minimum wage

The National Living Wage is GBP 12.71 an hour for workers aged 21 and over from 1 April 2026; lower hourly rates apply to workers under 21 and to apprentices.

GBP 12.71 · from 1 April 2026per hour, gross, workers aged 21 and over (National Living Wage)

• Aged 21 and over (National Living Wage): GBP 12.71 per hour
• Aged 18 to 20: GBP 10.85 per hour
• Under 18 (above school leaving age): GBP 8.00 per hour
• Apprentice rate: GBP 8.00 per hour (apprentices under 19, or aged 19 and over in the first year of the apprenticeship)
• Rates change on 1 April every year and apply across the United Kingdom

Changes on 1 April 2027: National Living Wage GBP 13.21 an hour (aged 21 and over), GBP 11.27 (18 to 20) and GBP 8.31 (under 18 and apprentices), accepted by the government on 28 October 2026; the regulations are not yet made. Announced Source: LPC recommendations take the National Living Wage to £13.21

Employer social security contributions

Employers pay Class 1 National Insurance at 15% on each employee's earnings above GBP 5,000 a year, with no upper ceiling; eligible employers can deduct up to GBP 10,500 a year through the Employment Allowance.

15% above GBP 5,000 a year, no ceiling · from 6 April 2026employer (secondary) Class 1 National Insurance on each employee's earnings above the secondary threshold (GBP 96 a week, GBP 417 a month, GBP 5,000 a year), tax year 2026 to 2027

• Secondary threshold: GBP 96 a week, GBP 417 a month, GBP 5,000 a year
• Rate 15% (category A) on all earnings above the secondary threshold, including the balance above the upper earnings limit (GBP 50,270): no contribution cap
• 0% up to GBP 50,270 a year for employees under 21 (M), apprentices under 25 (H) and veterans (V); Freeport and Investment Zone relief up to GBP 25,000
• Class 1A on taxable benefits: 15%
• Employment Allowance 2026 to 2027: GBP 10,500 off the annual employer National Insurance bill (eligible employers)
• Apprenticeship Levy: 0.5% of the annual pay bill where the employer and connected companies have a pay bill over GBP 3 million, less a GBP 15,000 allowance
• Employee (primary) Class 1 for comparison: 8% between GBP 12,570 and GBP 50,270 a year, 2% above

Payroll tax withholding and filing

Employers deduct income tax and National Insurance through PAYE, report every pay run to HMRC in a Full Payment Submission on or before payday, and pay HMRC by the 22nd of the following tax month.

Employer via PAYE; FPS on or before each payday; pay HMRC by the 22nd of the next tax monthReal Time Information reporting to HM Revenue and Customs (HMRC), https://www.gov.uk/government/organisations/hm-revenue-customs; tax months run from the 6th to the 5th

• Authority: HM Revenue and Customs (HMRC), https://www.gov.uk/government/organisations/hm-revenue-customs
• Full Payment Submission (FPS) on or before each payday, even if HMRC is paid quarterly
• Employer Payment Summary (EPS) by the 19th of the next tax month to claim reductions, and for any tax month with no employees paid
• Payment by the 22nd of the next tax month (19th if paying by post); quarterly payment possible where the monthly bill is usually under GBP 1,500
• Employer and employee National Insurance are reported in the same FPS and paid in the same PAYE bill: no separate social security return
• Register as an employer with HMRC before the first payday, and not more than 2 months before

Salary payments a year and holiday allowance

UK law requires no 13th-month payment or holiday allowance; the contract states how often pay is made, for example weekly or monthly, and holiday is paid at a normal week's pay.

No statutory 13th month; pay interval set by contractnumber of payments a year is a contractual term (the written statement gives the pay interval, for example weekly or monthly); no statutory holiday allowance

• The written statement of employment particulars must give 'the intervals at which remuneration is paid (that is, weekly, monthly or other specified intervals)' (Employment Rights Act 1996, s.1(4)(b))
• Acas: 'There is no legal requirement for an employer to provide a bonus'; contractual bonuses must be paid when the agreed criteria are met
• Holiday pay is a week's pay for each week of statutory leave taken, not a separate allowance

Paid annual leave

Almost all workers are entitled to 5.6 weeks' paid holiday a year, which is 28 days for a five-day week; the entitlement is capped at 28 days and may include bank holidays.

5.6 weeks (28 days on a 5-day week)paid statutory leave a year, capped at 28 days; bank holidays may be counted within it

• Five-day week: at least 28 days; six-day week: still capped at 28 days
• Part-time with regular hours: pro rata, for example 16.8 days for a three-day week
• Irregular-hours and part-year workers: accrue 12.07% of hours worked in each pay period
• Holiday pay: at least 4 weeks at the 'normal' rate; the remaining 1.6 weeks may be paid at the 'basic' rate (regular-hours workers)
• Carry-over: up to 8 of the 28 days where the contract allows

Sick pay

Employers pay Statutory Sick Pay of GBP 123.25 a week, or 80% of average weekly earnings if lower, from the first day of sickness for up to 28 weeks; it cannot be reclaimed from HMRC.

Employer pays SSP GBP 123.25 a week (or 80% of average weekly earnings if lower) from the first day, up to 28 weeks · from 6 April 2026Statutory Sick Pay, 2026 to 2027 weekly rate, paid by the employer for qualifying days; not recoverable from HMRC

• Weekly rate 2026 to 2027: GBP 123.25 or 80% of average weekly earnings, whichever is lower
• Payable once the employee is sick for at least one full working day, from the first day of illness: the waiting period and the lower earnings limit were removed on 6 April 2026 (Employment Rights Act 2025, ss.10 to 13, commenced by S.I. 2026/373)
• Maximum 28 weeks; periods of sickness 8 weeks or less apart are linked
• A fit note can be required after more than 7 days in a row
• Paid by the employer through payroll like wages; SSP cannot be recovered from HMRC

Running payroll without a local entity

A non-UK employer without a UK presence may register voluntarily with HMRC to run PAYE; it must register and pay employer National Insurance where a social security agreement, such as with the EU, requires it.

HMRC PAYE scheme: voluntary without a UK presence; required to pay employer NIC under agreements with employer obligations (EU, EEA EFTA, Switzerland)registration as an employer with HM Revenue and Customs (one PAYE scheme covers income tax and National Insurance)

• PAYE applies to an employer with a UK tax presence (branch, agency or representative office); employees in the UK alone do not create one
• An employer without a UK presence may operate PAYE voluntarily; if it does not, a UK business for whom the employee works must operate PAYE (ITEPA 2003 s.689)
• Where no one operates PAYE, the employee can pay income tax and employee National Insurance through a Direct Payment (DPNI) scheme; an employee-only National Insurance route (DCNI) also exists
• Employer from a country with an agreement that includes employer obligations (EU, EEA EFTA states, Switzerland, Isle of Man, Gibraltar): must register with HMRC and pay employer Class 1 National Insurance; the employee may agree to register and pay on the employer's behalf
• Employer from any other country with no UK place of business: no employer National Insurance, but employee National Insurance is still due

Pension

Employers must automatically enrol workers aged 22 to State Pension age earning at least GBP 10,000 a year into a workplace pension and pay at least 3% of qualifying earnings, within an 8% total minimum.

Automatic enrolment: minimum 8% of qualifying earnings, employer at least 3% · from 6 April 2026workers aged 22 to State Pension age earning at least GBP 10,000 a year; qualifying earnings band GBP 6,240 to GBP 50,270 (2026 to 2027); State Pension built through National Insurance

• Earnings trigger 2026 to 2027: GBP 10,000 a year (GBP 833 a month)
• Qualifying earnings 2026 to 2027: GBP 6,240 to GBP 50,270 a year (GBP 520 to GBP 4,189 a month)
• Minimum contributions since 6 April 2019: 8% in total, including 5% from the worker; employer at least 3%
• Duties start when the first member of staff starts work; enrolment can be postponed by up to 3 months
• State Pension: built from National Insurance qualifying years; 10 qualifying years needed for any new State Pension; full rate GBP 241.30 a week

Probation and notice

There is no statutory probation period; after one month's service an employer must give at least one week's notice, rising to one week per year of service from two years, up to twelve weeks.

No statutory probation; employer notice 1 week (1 month to 2 years' service), then 1 week per year of service, maximum 12 weeksstatutory minimum notice from the employer (Employment Rights Act 1996, s.86); employee gives at least 1 week after 1 month's service

• Employer notice: 1 week (1 month to under 2 years' service); 1 week per year of continuous employment (2 to under 12 years); 12 weeks (12 years or more)
• Employee notice: at least 1 week after 1 month's service
• Contracts can set longer notice; either party may waive notice or accept payment in lieu (s.86(3))
• Probation: no legal requirement and no maximum length (Acas); the Employment Rights Act 2025 does not change this
• Unfair dismissal qualifying period: 2 years where the effective date of termination is before 1 January 2027; 6 months from 1 January 2027 (Great Britain)
• Section 86 extends to England, Wales and Scotland; Northern Ireland has its own legislation (qualifying period there usually 1 year)

Changes on 1 January 2027: The qualifying period for unfair dismissal falls from two years to six months, and the cap on the compensatory award is removed (Great Britain). Statutory notice does not change. Published Source: The Employment Rights Act 2025 (Commencement No. 4 and Transitional and Saving Provisions) Regulations 2026 (S.I. 2026/559)