Celebrating National Payroll Week 2026: The Numbers Every Payroll Team Should Know

National Payroll Week celebrates the professionals who keep payroll running flawlessly. For bureaus, accountants and bookkeepers managing payroll clients, this is your annual reminder of the rates, thresholds, and statutory rules that affect every pay run in the 2026/27 tax year.

This is a quick refresher of the payroll essentials you need to keep in mind, from calculating statutory sick pay correctly to managing Employment Allowance claims and navigating the latest pension auto-enrolment rules.

What Is National Payroll Week and Why It Matters

National Payroll Week honours the vital work of payroll professionals across the UK. It’s a chance to refresh on compliance, celebrate the accuracy that keeps employees paid correctly, and acknowledge the work and complexity that goes on behind every payslip.

Each April can bring new thresholds, statutory rates, and pension rules. Miss these numbers or apply them incorrectly, and you’re potentially exposing clients to underpayment claims, HMRC penalties, and reputational damage.

Payroll isn’t just about moving money from employer to employee. It’s about regulatory compliance, tax accuracy, and employee relations. One mistake in calculating Statutory Maternity Pay or missing a seasonal worker’s holiday accrual can snowball into disputes, fines, and wasted time correcting payroll records. National Payroll Week is the ideal moment to ensure your team is armed with this year’s rates and that they are confident in how to apply them.

Do You Know Your UK Payroll Calculations?

What’s the difference between Gross Pay and Net Pay in the UK?

Gross pay is the employee’s total agreed salary before any deductions. Net pay (or sometimes known as take-home pay) is what lands in their bank account after Income Tax, National Insurance, pension contributions, and other deductions come out.

Clients set salaries based on gross figures, but employees focus on net. A £30,000 salary doesn’t mean £30,000 ends up in the bank. Understanding and explaining the breakdown of their gross pay and how it becomes net pay keeps employee relations smooth and manages expectations upfront.

Many employers don’t realise how much comes out of an employee’s wage. A £35,000 gross salary might result in a net take-home of just £27,000, depending on tax codes, National Insurance, pension contributions, etc. When employees see their payslip, they’re often shocked. Clear communication at onboarding prevents complaints later and sets realistic expectations regarding their payslips.

What Are the UK Holiday Entitlements for Irregular Workers?

From April 2024, holiday accrual for irregular hours and part-year workers changed fundamentally. Instead of rolling up holiday pay at a flat percentage, entitlement now accrues at 12.07% of hours worked in each pay period.

This means seasonal staff, zero-hours workers, and part-timers no longer carve out a percentage each week. The hours themselves determine the accrual. The good news is rolled-up holiday pay is now permitted, so you can pay it alongside regular wages rather than accumulating it for when they leave.

If a client employs a seasonal worker for 20 weeks at 30 hours per week, the calculation is straightforward. 20 weeks x 30 hours = 600 hours worked. Holiday entitlement is 600 hours x 12.07% = 72.42 hours. Multiply by their hourly rate to get the cash value.

For detailed guidance, understand the holiday pay rules for workers on irregular hours.

Statutory Pay in the UK Explained

Statutory Sick Pay (SSP) in the UK for the 2026/27 Tax Year

Statutory Sick Pay is the legal minimum an employer must pay when an employee is off sick. From April 2026, the rate is £123.25 per week or 80% of the employee’s average weekly earnings, whichever is lower. SSP can be paid for up to 28 weeks.

You work out the employee’s average earnings over the preceding 8 weeks. If they’ve only been with you a few weeks, you still pay SSP based on what they’ve earned so far. For part-time or irregular-hours workers, the daily rate is calculated by dividing the weekly rate by the number of qualifying days, which are days they normally work.

For a five-day worker off for three days, you’d pay three-fifths of £123.25. For employees where 80% of earnings is lower, divide their weekly average by the number of qualifying days instead. The calculation is simple once you understand the process, but errors can be quite common.

SSP in 2026-27: 123.25 pounds per week or 80 percent of average weekly earnings (whichever is lower), paid for up to 28 weeks.

See how BrightPay calculates SSP for a step-by-step process and how to avoid common pitfalls.

What is the Statutory Maternity Pay (SMP) and Paternity Pay (SPP) in the UK?

Statutory Maternity Pay is payable for up to 39 weeks. Employees get 90% of their average weekly earnings for the first six weeks, then £194.32 per week or 90% of average earnings (whichever is lower) for the next 33 weeks.

Statutory Paternity Pay applies when an employee takes leave following the birth or adoption of a child. They qualify if they’ve worked for at least 26 weeks by the qualifying week and are paid the lower of 90% of their salary or £194.32 per week. SPP can be taken for 1 or 2 weeks.

Are You Claiming Employment Allowance?

What is Employment Allowance in the UK? Employment Allowance is a tax-free allowance that reduces your National Insurance bill pound-for-pound. For the 2026/27 tax year, eligible employers can claim up to £10,500 of Employment Allowance. Most businesses and charities paying employer National Insurance qualify, with some exceptions. Single-director companies, connected companies, and certain sectoral organisations do not.

For a practice with a £200,000 annual payroll, Employment Allowance saves around £2,000-£3,000 per year depending on the exact structure. For smaller practices with tighter margins, that’s meaningful money. The application is straightforward if you’re registered with HMRC for PAYE, and the relief is applied monthly through your payroll software.

National Insurance and Pensions: What’s Changed for the 2026/27 Tax year

Current National Insurance Rates and Thresholds in the UK

The 2026/27 tax year brings the following National Insurance thresholds and rates.

• Employee National Insurance remains 8% on earnings above the primary threshold of £12,570 per year

• Employer National Insurance is 15% on earnings above the secondary threshold of £5,000 per year, with relief for under-21s and apprentices up to age 25

For the complete rates table including special categories (Freeport workers, Investment Zone employees, veterans), check current National Insurance rates and thresholds.

These National Insurance thresholds are frozen until the 2030/31 tax year, meaning they won’t rise in line with inflation.

What is Auto-Enrolment in the UK and Opt-Outs

Employers must enrol workers aged 22 and over (up to State Pension age) earning at least £11,500 gross per year, and contribute a minimum of 8% of qualifying earnings. This can be split, so an employer minimum 3% and employee minimum 5%.

Employees can opt out within 30 days of being enrolled, but you must provide opt-out information clearly. If an employee opts out, you have no further obligation until they re-enrol, which happens automatically every three years.

Why Payroll Teams Are Switching to BrightPay

Managing these rates manually is error-prone and time-consuming. BrightPay handles all of it automatically. BrightPay is a cloud-based payroll software, so it retrieves the latest HMRC rates and applies them automatically while you work. That way, you’re always compliant and using the most up-to-date version of the software. For hybrid or remote teams, BrightPay’s multi-user functionality means that multiple people can work in the same payroll file at the same time, with changes applied instantly while you all work. This brings that natural collaboration and team spirit you get from the office into your home offices and remote workspaces.

BrightPay calculates statutory sick pay, maternity pay, and paternity pay in seconds. It tracks qualifying days, works out average earnings, and handles part-time and irregular hours correctly. For practices with multiple clients, that’s hours of manual work eliminated per month.

Plus, BrightPay is fully integrated with HMRC and has full auto-enrolment functionality. For pensions, it integrates with NEST, The People’s Pension, and Smart Pension, so payroll journals flow straight from the payroll software to the pension provider’s portal. It’s also integrated with the UK’s leading bookkeeping software providers and payment platforms including Modulr.

Ready to eliminate manual payroll calculations this Payroll Week? Compare BrightPay plans for small business payroll or book a BrightPay demo this Payroll Week.

Payroll Questions We Hear All Year Round

How is SSP calculated if someone is off for part of a week?

Divide the weekly SSP rate by the number of qualifying days in that week, then multiply by the qualifying days taken. On a five-day working week, one day is a fifth of the weekly rate.

How do I calculate net pay from gross salary?

Net pay = Gross pay – (Income Tax + National Insurance + pension contributions + any other deductions such as student loan repayments).

What are the current National Insurance rates?

Employer and employee National Insurance rates and thresholds are set each tax year. Check current National Insurance rates and thresholds.

How is holiday pay calculated for irregular hours or part-year workers?

Since the 2024 reforms, holiday entitlement for irregular hours and part-year workers accrues at 12.07 percent of hours worked in each pay period, and rolled-up holiday pay is permitted.

What is Employment Allowance and is my business eligible?

Employment Allowance reduces an eligible employer’s annual National Insurance bill. Most businesses and charities paying employer NI can claim, with some exclusions including single-director companies. Learn more about Employment Allowance eligibility.

This content may have been developed with the assistance of AI tools. Content is reviewed by a member of the Bright team before publication. Guidance on legislation can be obtained from your industry body.