How to convert hourly pay to an annual salary, and back

One job advertises 22 an hour, another 45,000 a year, a third 3,600 a month. To compare them you have to put them on the same footing, and the conversions are easy to get slightly wrong.

Hourly to annual

annual = hourly rate × hours per week × weeks paid per year

A full-time week of 40 hours, paid for all 52 weeks, is 2,080 hours a year. At 20 an hour that is 20 × 40 × 52 = 41,600 a year. For a 37.5-hour week it is 1,950 hours, so the same 20 an hour comes to 39,000.

A handy shortcut for a 40-hour week is to multiply the hourly rate by 2,000: 20 an hour is roughly 40,000 a year. The shortcut assumes about 50 paid weeks, which makes it a slightly cautious estimate.

Annual to hourly

Divide the salary by the hours worked in a year. A salary of 50,000 for a 40-hour week is 50,000 ÷ 2,080 = 24.04 an hour. If you take unpaid weeks off, you work fewer hours for the same salary, so your effective hourly rate rises.

The months-and-weeks trap

A month is not four weeks. A year has 52.18 weeks, so an average month is about 4.35 weeks. Converting a weekly wage to a monthly one by multiplying by four understates it by about 8%:

• 800 a week × 4 = 3,200 — too low.
• 800 a week × 52 ÷ 12 = about 3,467 — correct.

The safe method for any conversion is to go through the annual figure: turn whatever you have into a yearly amount, then divide by 12 for months, 52 for weeks, or the number of hours you work. The Salary Calculator does exactly that and shows every period at once.

Comparing job offers fairly

A raw salary comparison misses things that change what each hour is really worth:

• Paid holiday. A salaried job with paid holiday pays you for weeks you do not work; an hourly contract may not. Compare the annual figure for the time you will actually be paid.
• Hours. 45,000 for 35 hours a week is a better hourly rate than 48,000 for 45 hours — about 24.73 against 20.51.
• Overtime. Many hourly jobs pay a higher rate for hours beyond a threshold; many salaried jobs do not pay extra for longer days.
• Pension and benefits. An employer pension contribution, health cover or a bonus can be worth several percent of salary.

To see how much more one offer pays than another, the Percentage Calculator gives the difference as a percentage of your current pay.

What a pay rise is worth

A percentage rise is easiest to judge in the units you think in. A 5% rise on 41,600 a year is 2,080 more a year — 40 a week, or 1.00 more an hour on a 40-hour week. Before tax, of course: the amount you keep depends on your tax band.

Freelance day rates

A freelancer comparing a day rate with a salary needs to allow for the days they are not paid. A full-time employee is paid for about 260 weekdays a year, including paid holiday and public holidays, but works roughly 225–235 of them. Dividing a 50,000 salary by about 230 working days gives roughly 217 a day — and a freelancer charging that would earn less than the employee, because they also pay for their own holidays, sick days, pension, equipment and the gaps between contracts. Day rates are higher than salaries for good reason.

Gross is not what you take home

Every figure above is gross pay, before income tax, social security contributions, pension and other deductions. Take-home pay depends on your country and circumstances. In the UK in 2026/27, for example, a salary of £30,000 leaves £25,119.60 a year after income tax and National Insurance, before any pension or student loan. The Take-Home Pay Calculator estimates this for the UK, Canada, Australia and India, with every deduction listed.

Part-time and irregular hours

For part-time work, use your actual weekly hours: 20 hours a week at 18 an hour is 18,720 a year for 52 paid weeks. For irregular hours, take the average over several months rather than a single week. For pay that is quoted per day, multiply by the days you work in a week and then follow the same steps.

Quick reference at 40 hours a week

Monthly figures are the yearly figure divided by 12, rounded to the nearest whole unit.