PAY UP
Did you get a pay rise? Check your wages to see how much yours has changed
Keep scrolling to see how you can find out what you will actually make this year
WORKERS who received a pay rise in April should be aware of a helpful tool which can help calculate their new take home pay.
This month the Government hiked the National Living Wage - the minimum earnings for employees who are aged 21 and over - by 6.7%.
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The hourly rate has increased from its previous figure of £11.44 per hour to £12.21 per hour, and means you could see an annual boost of £1,400.
So, for example, if you were employed full-time and worked a 35-hour week, you could see your annual salary increase to £22,222.
However, it's important to note that this figure reflects your earnings before tax and other deductions, meaning your actual take-home pay will be lower.
If you received a pay rise this April, it's worth calculating how much your take-home pay will be after tax and deductions.
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the website founded by Martin Lewis, has an , which can help with this.
You will need to have information like what your yearly salary is before tax otherwise known as your gross income.
You also need to enter information like your pension contributions, if you make any and what you repay in student loans.
Once you enter the information it calculates what you will actually make in a year.
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So if you earned £22,222 a year you would actually take home £19,519 a year after tax deductions.
That's because over the year you'll pay £1,930 income tax and £772 in national insurance.
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According to the MSE website, your monthly take-home pay would amount to £1,627.
Everyone who is employed in the UK and makes over £12,570 a year has to pay tax.
The most common you will see on your payslip are income tax and national insurance contributions.
The money is taken off your wages and goes towards funding national services or certain benefits such as the state pension.
How are you taxed?
How much you have to pay is generally based on your earnings, with people making less not as heavily taxed.
Income tax is split into four bands which are as follows:
- Earnings of £0 to £12,570 a year– 0% (no tax)
- Earnings of £12,571 to £50,270 – Basic rate: 20%
- Earnings of £50,271 to £125,140 – Higher rate: 40%
- Earnings of Over £125,140 – Additional rate: 45%
Meanwhile, how much you pay in National Insurance is based on your weekly pay.
The rates are as follows:
- Earnings of £0 to £242 a week: 0%
- Earnings of £242.01 to £967: 8%
- Earnings of over £967: 2%
For example, if you earn £1,000 a week, you pay nothing on the first £242, £58 on the next £725, and 66p on the remaining £33.
If you don't work you can apply for National Insurance credits.
Minimum wage rates
THE National Minimum Wage is the amount workers under 21 (but of school-leaving age) are entitled to.
The National Living Wage is paid to workers 21 and over.
Exactly what you'll get depends on how old you are.
Here are the rates that came into force on April 1, 2025:
- Those aged 21 and over - £12.21
- For 18 to 20-year-olds - £10
- 16 to 17-year-olds - £7.55
- The apprentice wage - £7.55
Why it's important to check if you're being paid the correct amount
Workers aged 21 and over should now earn £12.21 an hour as a minimum.
The new rates apply to everyone and are different based on your age, including whether you are in an apprenticeship role.
However, there are various reasons why you might not receive the national minimum wage when you should, despite the fact that it is illegal.
For example, unpaid working time can cause your hourly rate to drop below the minimum level.
This includes overtime, training time or being asked to arrive early.
Your boss might not raise your salary when the rates increase every April or if you move into a higher wage bracket as you get older.
If you've had to buy a uniform for work, that can drag you below the minimum wage, too.
You can use the government's new calculator by visiting checkyourpay.campaign.gov.uk to check you're getting the correct amount based on your salary.
How to get the money you're owed
There are two approaches you can take if you think you're being underpaid.
You can anonymously
As part of the claim, you'll be asked for some personal details and questions about your complaint.
You should agree to let HMRC contact you as it might need more information to move your claim forward.
The tax office will launch an investigation if it has enough information and will take action if it determines that you have been underpaid.
It can make your boss repay you the amount that's missing, and this can be backdated by six years at the current minimum wage rate.
Your colleagues will also get a refund if they've been affected.
HMRC could also fine your employer or take it to court if it refuses to pay out.
These investigations can take several months, so it's not the quickest option to get the money you're owed.
The other option is to have an informal conversation with your boss.
Consider whether you want to receive back pay or just be paid a higher rate going forward.
It will be helpful to have evidence of your claim including payslips and an idea of how much you have been underpaid.
If an informal chat doesn't work, you can make a formal complaint - check how to do this with your company's HR department.
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Following that, your final option is to take the company to an employment tribunal.
You can find out more about how to do this on MoneySavingExpert.com or by checking with Citizens Advice.
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