Quick answer, reviewed 11 October 2026
The event on 26 March 2025 was the Spring Statement. Several changes often grouped with it were announced at Autumn Budget 2024. As at 11 October 2026, employer NIC is generally 15% above the £5,000 secondary threshold, the National Living Wage for workers aged 21 and over is £12.71, and Business Asset Disposal Relief has an 18% rate for qualifying disposals from 6 April 2026.
Use the correct event and effective date
A fiscal announcement, a law and the date a rule takes effect are different milestones. The Chancellor delivered the Spring Statement on 26 March 2025. Its official documents are available in HM Treasury's Spring Statement collection. The employer National Insurance changes that took effect in April 2025 came from Autumn Budget 2024, rather than a separate Spring Budget 2025.
This article keeps that historical context and updates the practical figures for 2026/27. A figure labelled 2025/26 should not be carried into a current payroll forecast without checking it. Similarly, a consultation or announced future change should not be treated as an existing obligation until its legal position and commencement date are established.
Employer National Insurance remains a payroll cost
For ordinary category A employees in 2026/27, employer Class 1 National Insurance is generally 15% above the annual £5,000 secondary threshold. Special rules and thresholds can apply to particular employees, including some younger workers and apprentices. Directors have additional calculation rules. Use HMRC's 2026/27 payroll table for the category and pay period concerned.
As a simple annual illustration, a £30,000 salary creates employer NIC of (£30,000 minus £5,000) multiplied by 15%, or £3,750, before Employment Allowance and any special relief. Ten identical employees would generate £37,500 on those assumptions. This is a gross illustration; actual payroll calculations and allowance eligibility must be applied.
The historical comparison also needs care. Using the old 13.8% rate and £9,100 threshold gives £2,884.20 per employee. The difference for ten employees is £8,658 before the change in Employment Allowance. A realistic comparison includes the allowance available in each year, employee categories and changing salaries.
Check Employment Allowance rather than assuming it
The maximum Employment Allowance is £10,500 for eligible employers. This can offset employer Class 1 NIC, but entitlement depends on the business's circumstances. A company with only one director who is the only employee liable for employer NIC cannot claim it. Connected-company and other exclusions must also be considered. See the eligibility rules.
Review the claim through payroll and check whether a connected business is using it. Treat it as a reduction in a calculated employer liability, rather than assuming every company receives a cash grant of £10,500. If staffing changes, reassess eligibility and the effect on the annual forecast.
National Living Wage: use the April 2026 figures
From 1 April 2026, the statutory rates are £12.71 per hour for workers aged 21 and over, £10.85 for ages 18 to 20, and £8.00 for under-18 workers. The apprentice rate is £8.00 for eligible apprentices, including those under 19 or in the first year of their apprenticeship. Other apprentices receive the applicable age rate. Source: GOV.UK minimum wage rates.
The £12.21 National Living Wage belongs to April 2025 to March 2026. For a current forecast, calculate paid hours using the correct 2026 rate, then add employer NIC, employer pension contributions and other employment costs. A wage figure based on assumed full-time hours should always show those hours; there is no single annual cost applying to every full-time worker.
Review deductions, salary sacrifice and unpaid working time because they can affect minimum wage compliance. Changing a worker's label to self-employed is not a simple solution to payroll costs. Employment status follows the actual arrangement, with tax and employment-law tests that require a separate assessment.
Business rates in England have changed again
The 40% retail, hospitality and leisure relief was a 2025/26 measure. For 2026/27, qualifying properties in England with a rateable value below £500,000 instead use lower RHL multipliers: 38.2p below £51,000 and 43.0p from £51,000 to £499,999. The 2026 revaluation and available reliefs also affect the final bill.
Check the new rateable value, the property's qualifying use, the multiplier and any transitional or other relief shown on the council bill. A lower multiplier does not necessarily mean the final bill falls if the rateable value rises. See GOV.UK's 2026/27 calculation guidance. Different systems apply outside England.
Disposals and director dividends
The standard individual Capital Gains Tax rates are generally 18% and 24%, depending on the gain and available basic-rate band. Business Asset Disposal Relief increased to 14% for qualifying disposals in 2025/26 and is 18% from 6 April 2026. Its £1 million lifetime limit and eligibility tests still require review. Sources: CGT rates and Business Asset Disposal Relief.
For 2026/27, dividend rates are 10.75%, 35.75% and 39.35%, with a £500 dividend allowance. These current figures should feed into director remuneration planning. See HMRC's dividend rates and our salary and dividend guide.
A practical review for the remainder of 2026/27
- Update wage forecasts using actual hours and employee age bands.
- Confirm employer NIC categories and Employment Allowance eligibility.
- Check the 2026/27 rates bill against the revalued property and current reliefs.
- Model company and personal taxes together before changing director pay.
- Review the conditions and timing of any intended business disposal before signing contracts.
Keep separate cash forecasts for payroll, VAT, Corporation Tax and personal tax. That makes it easier to see how a policy change affects cash available for stock, staff or investment, rather than assuming a single headline measure explains the whole business position.
Frequently asked questions
Was there a Spring Budget in March 2025?
The official event on 26 March 2025 was the Spring Statement. Employer NIC changes effective in April 2025 were announced at Autumn Budget 2024.
What is the National Living Wage in October 2026?
For workers aged 21 and over, it is £12.71 per hour from 1 April 2026. Other age and apprentice rates apply where relevant.
Does the 40% retail business rates relief continue in 2026/27?
The 2025/26 relief has been replaced by lower retail, hospitality and leisure multipliers for qualifying properties in England with rateable values below £500,000. Check the council bill and other reliefs.
Reviewed against the linked primary sources on 11 October 2026. This guide gives general information; the tax treatment depends on your circumstances and the relevant tax or accounting period.
For support with your records and calculations, see our payroll service or contact Angel Accountancy to discuss your requirements.