What Is the Minimum Director Salary in the UK? (2026/27)
There is no legal minimum salary for a company director who is an officeholder without an employment contract — you can legally pay yourself £0. But the practical minimum for most directors is £6,708 (the 2026/27 Lower Earnings Limit), because that's the lowest salary that still earns a State Pension qualifying year.
Want the exact number for your company?
Use our optimal director salary calculator to get your personal answer in 30 seconds. It checks Employment Allowance, tax thresholds, and National Insurance in one go.
Directors and the minimum wage
National Minimum Wage doesn't apply to officeholders with no contract of employment, which is the position of most owner-directors. That means you are not legally required to pay yourself any minimum hourly rate.
It does apply if the director has an employment contract with the company. In that case, the National Living Wage of £12.71 per hour (age 21+, from 1 April 2026) applies to the hours worked under that contract.
The salary ladder for 2026/27
Not every low salary is equally sensible. Here are the meaningful levels, from lowest to highest, for a single-director limited company in 2026/27.
| Salary level | What it means |
|---|---|
| £0 | Legal for an officeholder, but no State Pension credit and the Personal Allowance is wasted. |
| £5,000 | Secondary Threshold — the last point before employer NI starts at 15% above this. |
| £6,708 | Lower Earnings Limit — the practical minimum. State Pension qualifying year, zero employee NI, zero income tax; employer NI is just £256 (£1,708 × 15%). |
| £12,570 | Primary Threshold / Personal Allowance — zero income tax and zero employee NI; best level if the company can claim Employment Allowance. |
| Above £12,570 | Income tax and employee NI both kick in — rarely optimal without a specific reason. |
For a deeper comparison of the two most common salary points, see our £6,500 vs £12,570 director salary guide.
Why the State Pension credit matters
You need 35 qualifying years to receive the full new State Pension of £241.30 per week (£12,547.60 per year) in 2026/27. Each missed year costs roughly 1/35th of that — about £358 per year, every year of retirement.
Buying back a missed year voluntarily with Class 3 National Insurance contributions typically costs over £900. By contrast, a £6,708 salary that earns the credit for free is one of the best deals in the tax system: you protect a valuable future income while keeping current tax and NI very low.
When paying less than £6,708 makes sense
Paying less than £6,708 is not always wrong. It can be sensible if:
- You already have a qualifying year from other employment or self-employment in the same tax year.
- You already have 35 qualifying years and don't need any more to reach the full State Pension.
- You are above State Pension age and no longer building entitlement.
- The company genuinely cannot afford it — for example, in a very difficult cash-flow position.
When paying more makes sense
There are also good reasons to pay more than the £6,708 minimum:
- Employment Allowance is available. If your company can claim it, the £12,570 salary usually becomes the better choice because the employer NI is covered by the £10,500 allowance. See our Employment Allowance guide for the full eligibility rules.
- You need payslip income. Mortgage lenders, some visa applications, and loan providers may want to see regular salary income above a certain level.
- Contractual or IR35 considerations. Some engagements or working arrangements may require a market-rate salary.