Convert your hourly pay to an annual salary with full income tax, NI, pension and student loan deductions for a true take-home picture.
Hourly Rate to Annual Salary Calculation
Gross annual salary
Total compensation (with employer pension)
Income tax
Employee NI
Employee pension deduction
Student loan repayment
Annual net take-home
Monthly net take-home
Weekly net take-home
Daily equivalent (÷ 260 days)
Net hourly equivalent
Based on 2025/26 UK tax bands and NI thresholds. Assumes standard personal allowance (£12,570). Does not include Scottish income tax rates. Pension calculation uses relief-at-source on qualifying earnings above £6,240.
How to Convert an Hourly Rate to Annual Salary
The basic calculation is: hourly rate × weekly hours × weeks per year = gross annual salary. The standard UK working year is 52 weeks for PAYE employees who receive paid holiday as part of their contract, or 47 weeks for workers who want to see the value of hours actually worked excluding holiday.
The True Total Compensation Package
Your gross salary is not your total compensation. An employer also contributes to your pension (minimum 3% under auto-enrolment, often 5–10%) and provides holiday pay. At £15/hour for 37.5 hours over 52 weeks, your gross is £29,250. With a 5% employer pension contribution (£1,463) your total compensation is £30,713 — 5.4% more than the headline salary.
2025/26 Income Tax Bands (England, Wales and Northern Ireland)
Personal allowance: £12,570 (0% tax)
Basic rate: 20% — from £12,571 to £50,270
Higher rate: 40% — from £50,271 to £125,140
Additional rate: 45% — above £125,140
2025/26 Employee NI Rates
8% on earnings between £12,570 and £50,270
2% on earnings above £50,270
0% below £12,570 per year
Student Loan Repayment Thresholds 2025/26
Plan 1: 9% above £24,990
Plan 2: 9% above £27,295
Plan 4 (Scotland): 9% above £31,395
Plan 5: 9% above £25,000
Frequently Asked Questions
How do I convert an hourly rate to an annual salary? +
Multiply your hourly rate by weekly contracted hours, then by weeks per year. For example, £15/hour × 37.5 hours × 52 weeks = £29,250 gross annual salary. If you receive paid holiday as part of your contract, use 52 weeks. If holiday is unpaid, subtract holiday weeks from 52.
Should I use 52 weeks or 47 weeks? +
Use 52 weeks if your contract includes paid holiday — your hourly rate already covers holiday pay. Use 47 weeks if you want to calculate only weeks actually worked, excluding approximately 5 weeks of annual leave. For most PAYE employees, 52 weeks is correct.
What are employee NI rates in 2025/26? +
Employee NI is 8% on earnings between £12,570 and £50,270, and 2% above £50,270. There is no NI on earnings below £12,570. These rates apply to employment income. Self-employed Class 4 NI rates differ.
How does employer pension contribution affect my total pay? +
Employer pension contributions go directly to your pension — they don't appear in take-home pay. But they are a real financial benefit. At 5% employer contribution on a £30,000 salary, that is £1,500/year added to your pension. Include it when comparing job offers to see true total compensation.
What are the student loan repayment thresholds? +
Plan 1: 9% above £24,990. Plan 2: 9% above £27,295. Plan 4 (Scotland): 9% above £31,395. Plan 5 (new loans from 2023): 9% above £25,000. Repayments are collected via PAYE automatically alongside tax and NI.
What is the National Minimum Wage in 2025/26? +
The National Living Wage (age 21+) is £12.21/hour from April 2025. Aged 18–20: £10.00/hour. Aged 16–17 and apprentices: £7.55/hour. All workers must receive at least the NMW for their age group regardless of employment type.
What is the difference between gross and net hourly rate? +
Gross hourly rate is your pay before deductions. Net hourly rate is what you actually receive after income tax, NI, pension and student loan repayments are deducted. Divide your annual net take-home by total working hours per year to find your true net hourly rate.
Does holiday pay affect the hourly to annual calculation? +
For PAYE employees with paid holiday, holiday is already included in the salary when you use 52 weeks. For agency workers or casual workers paid only for hours worked, holiday pay of 12.07% of hours worked may be added separately to their rate, or rolled up into the hourly rate.
How do I calculate my net hourly rate? +
Divide annual net take-home by total working hours per year (hourly rate × weekly hours × weeks). For example, net take-home of £22,500 ÷ 1,950 annual hours (37.5 × 52) = £11.54 net per hour.
What if I work part-time? +
Part-time workers use the same method — enter your actual contracted hours per week. Tax bands and NI thresholds apply equally based on annual earnings. Part-time workers receive the same minimum wage entitlements per hour as full-time workers.
How is income tax calculated on hourly-rate earnings? +
Income tax is calculated on your total annual gross earnings regardless of whether you are paid hourly or salaried. The same bands apply: 20% from £12,571–£50,270, 40% from £50,271–£125,140, 45% above £125,140. PAYE collects tax monthly as a proportion of the annual figure.
Can I use this calculator for agency workers? +
Yes. Agency workers paid through PAYE are taxed in the same way. If you are a sole trader or self-employed, the NI calculation differs (Class 2 and Class 4 NI rates apply instead of employee NI). Use this calculator for PAYE employment only.