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/