What this calculator works out
This calculator converts an hourly rate into an annual gross salary, and shows the monthly equivalent. It multiplies the rate by the hours you work each week and the number of paid weeks in your year.
It is most useful when comparing an hourly role against a salaried one, or when judging whether a rate that sounds reasonable per hour adds up to a workable income.
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Before you convert
- Use the hours you are actually offered, not the maximum available. Variable-hours and zero-hours contracts rarely deliver a consistent week.
- Set paid weeks realistically. An hourly worker without paid holiday does not earn for 52 weeks unless they work them.
- Check whether holiday pay is included in the rate or paid separately. Rolled-up holiday pay is shown as part of the hourly figure.
- Remember the result is gross, before tax, National Insurance and pension.
A salaried employee earning £17.95 an hour is paid during annual leave. An hourly worker on the same rate with no paid holiday earns nothing during those weeks. The statutory entitlement is 5.6 weeks a year, which is worth roughly 12% on top of the rate — a substantial difference that a simple rate comparison hides.
How this calculator works
Two multiplications and one division:
Annual salary = hourly rate × hours per week × paid weeks per year
Monthly gross = annual salary ÷ 12Setting paid weeks to 52 assumes you are paid for every week of the year, which is correct for salaried-equivalent comparisons. If you only earn when you work and take four weeks off, use 48 instead — the difference in the annual figure is considerable.
Worked example: £15 an hour
Using the default figures — £15 an hour, 37.5 hours a week, 52 paid weeks:
- Annual gross: £15 × 37.5 × 52 = £29,250
- Monthly gross: £29,250 ÷ 12 = £2,437.50
Now change paid weeks to 46.4, which is 52 weeks less the 5.6 weeks of statutory holiday. The annual figure falls to about £26,100 — a difference of over £3,000. That gap is the value of paid holiday, and it is the single most important thing to establish when comparing an hourly rate against a salary.
Common mistakes
- Assuming full-time hours will always be available. On variable contracts, use a realistic average rather than the best week.
- Ignoring whether holiday pay is included. This changes an apparently equal rate by roughly 12%.
- Comparing an hourly rate directly with a salary. Convert first, then compare like with like.
- Forgetting unpaid breaks. Nine hours on site is often eight hours paid.
- Overlooking non-pay benefits. Employer pension contributions and sick pay have real value and rarely appear in an hourly rate.
Frequently asked questions
How many paid weeks should I use?
Use 52 if you want the salary-equivalent figure for comparison purposes, and if your holiday is paid. Use the number of weeks you will actually be paid for if holiday is unpaid — typically 46 to 48 for someone taking a normal amount of time off.
What is rolled-up holiday pay?
It is holiday pay included in the hourly rate rather than paid when you take leave. It must be shown separately on your payslip where it applies. If your rate includes it, the headline figure looks higher but you are not paid additionally for time off, so use 52 weeks and understand that the rate is doing two jobs.
Does this work for freelance or contract rates?
Only as a rough starting point. Self-employed rates need to cover unpaid time between contracts, your own pension, sick leave, holiday, insurance and equipment, plus the fact that you pay both sides of some costs an employer would otherwise carry. A common approach is to assume considerably fewer than 52 billable weeks.
Is the result before or after tax?
Before. Run it through the UK Payslip Estimator to see an approximate take-home figure.
What is the current minimum wage?
It changes each April and varies by age, with a separate apprentice rate. GOV.UK publishes the current figures, linked below.
Related tools
References
- GOV.UK — minimum wage rates, holiday entitlement and holiday pay rules
- MoneyHelper — guidance on comparing pay across different contract types
Sources are checked at publication and can change — how I choose and check references.