Changes to the National Living and National Minimum Wage

Your Sage 50 Payroll update should be released in February/March time. This will be a mandatory update to get the legislation changes to the National Living and National Minimum Wage.

National Living and National Minimum Wage

During the Autumn budget the chancellor announced that there will be an increase in both the National Living Wage and the National Minimum Wage.

The National Minimum Wage refers to young people or apprentices and the increase from April 2022 is as follows:

  • For ages 23 and over the minimum rate you can pay them is £9.50, this is currently £8.91 (2020/2021)
  • 21-22 year olds need to be paid a minimum of £9.18, currently £8.36
  • 18-20 year olds must be paid a minimum of £6.83, currently £6.56
  • Under 18’s need to be paid a minimum of £4.81, currently £4.62
  • Apprentices will be increasing to £4.81 from £4.30

Use Sage 50 Payroll to your advantage and use the National Min Wage and National Living Wage check to make sure you’re paying your workers the minimum.

Employment Allowance

For the tax year 2022/2023 the rate of Employment Allowance will remain the same at £4,000. Employment allowance allows employers who are eligible to reduce their National Insurance liability by up to £4,000 per annum. This means you will pay less employers’ Class 1 National Insurance each time you run your payroll until either the £4,000 has been used up or the tax year ends, whichever comes sooner. 

Before processing your 2022-2023 payroll in Sage 50 Payroll review and check your company settings to find out if you’re eligible to claim the employment allowance.

How to activate the minimum and national minimum wages in your Sage 50 Payroll

In your payment element settings, ensure the ‘Include Value in Minimum/Living Wage calculation’ is ticked:

How to apply for employment allowance if you’re eligible

You can make your claim through your Sage 50 Payroll software. 

Just go to your Company Settings, tick that you are eligible to received Employment Allowance and press apply for EA:

After doing this you will see this box appear for your ‘Employment Allowance Settings’. If State aid is not applicable select ‘Not Applicable’ from the dropdown and press submit.

If you need any guidance or support with your Sage 50 Payroll then please get in touch.


“Any advice relating to accounts or tax should be sought from your tax accountant. Sage Accounts Solutions Limited will not be held responsible for any loss or damage caused as a result of the information contained herein.”

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