Quick answer
- Hourly rate = annual salary ÷ annual working hours.
- Annual working hours usually means weekly hours × paid weeks per year.
- For a salaried employee, 52 paid weeks is commonly used because paid holiday is included in salary.
- For contractors, unpaid leave or gaps between contracts can reduce paid weeks and change the real hourly value.
Your hourly rate is useful when comparing jobs, checking whether a pay rise is worthwhile, looking at overtime, or deciding whether a day rate is better than a salary.
Use the calculator version
Enter salary, hours and weeks worked to get hourly, daily, weekly and monthly values.
The salary to hourly rate formula
The basic formula is simple: divide annual salary by annual working hours.
hourly rate = annual salary ÷ annual working hours
annual working hours = weekly hours × paid weeks per year
Use your gross annual salary before tax and deductions.
Multiply weekly hours by paid weeks per year.
Salary divided by annual hours gives your gross hourly rate.
Example: £30,000 salary to hourly rate
Suppose you earn £30,000 per year and work 37.5 hours per week. If you use 52 paid weeks, your annual working hours are 1,950.
annual working hours = 37.5 × 52 = 1,950
hourly rate = £30,000 ÷ 1,950 = £15.38 per hour
Gross annual salary.
Contracted weekly hours.
Salary paid all year.
Gross hourly equivalent.
Should you use 52 weeks?
For most salaried employees, using 52 paid weeks is a sensible starting point because salary is normally paid across the whole year, including paid holiday.
However, 52 weeks can overstate hourly value if you are comparing against contract work, unpaid leave, seasonal work, unpaid gaps or a role where hours are regularly higher than the contract says.
| Scenario | Weeks to consider | Why it matters |
|---|---|---|
| Salaried employee with paid holiday | 52 weeks | Salary is usually paid throughout the year. |
| Term-time or part-year work | Actual paid weeks | Pay may not reflect a full working year. |
| Contractor or freelancer | Paid/chargeable weeks | Holiday, sickness and gaps may be unpaid. |
| Unpaid overtime or long hours | Real hours worked | The effective hourly rate may be lower than the contract-hour calculation. |
Common salary to hourly examples
These examples use 37.5 hours per week and 52 paid weeks per year. They show gross hourly rate before tax and deductions.
| Annual salary | Annual hours | Hourly equivalent | Monthly gross pay |
|---|---|---|---|
| £24,000 | 1,950 | £12.31/hour | £2,000 |
| £30,000 | 1,950 | £15.38/hour | £2,500 |
| £40,000 | 1,950 | £20.51/hour | £3,333.33 |
| £50,000 | 1,950 | £25.64/hour | £4,166.67 |
Compare your hourly rate with minimum wage
Once you know your hourly equivalent, you can compare it with the current National Minimum Wage or National Living Wage for your age and status.
| Wage band | Rate from April 2026 | Simple check |
|---|---|---|
| Age 21 and over | £12.71/hour | National Living Wage rate. |
| Age 18 to 20 | £10.85/hour | National Minimum Wage rate. |
| Under 18 | £8.00/hour | National Minimum Wage rate. |
| Apprentice rate | £8.00/hour | Applies only to eligible apprentices. |
Minimum wage checks can be more complicated than a simple annual salary division, especially where unpaid hours, deductions, uniforms, accommodation or apprenticeships are involved. Use this as a quick sense-check, not a final legal conclusion.
Gross hourly rate vs net hourly rate
The hourly rate calculated from salary is normally a gross rate. It does not show what you take home after Income Tax, National Insurance, pension contributions, student loans or other deductions.
A £20 gross hourly equivalent does not mean £20 reaches your bank account for each hour. To understand after-tax pay, estimate net pay separately.
Check the after-tax number
Use the take-home calculator after you know the salary you are comparing.
Using hourly rate to compare job offers
Two jobs can have different headline salaries but a similar hourly value once working hours are considered. A higher salary can be less attractive if it comes with longer hours, more unpaid overtime or a difficult commute.
- Compare contracted hours: 35 hours and 40 hours can produce very different hourly values.
- Include realistic overtime: regular unpaid overtime lowers the true hourly value.
- Check benefits: pension, holiday, bonus, sick pay and flexibility can change the overall package.
- Look at travel time and cost: a higher salary can be eroded by commuting.
- Estimate take-home pay: salary comparisons should include net monthly pay.
Hourly rate and overtime
Overtime calculations usually start with a base hourly rate. If your employer pays time-and-a-half or double time, the base hourly rate is multiplied by the overtime multiplier.
If your salary includes expected unpaid overtime, your true hourly value may be lower than your contracted-hour calculation.
Estimate overtime pay
Use your hourly rate as the base for overtime calculations.
Hourly rate vs day rate
A day rate can look higher than a salary, but it may need to cover unpaid leave, sick days, gaps between contracts, pension, tax and business costs. Converting salary into hourly and daily values helps make the comparison clearer.
Compare salary with day rate
Convert salary to day rate, or day rate to annual income.
Common hourly-rate mistakes
- Using monthly pay instead of annual salary: multiply monthly salary by 12 first.
- Forgetting weekly hours: salary alone is not enough to calculate hourly rate.
- Ignoring unpaid overtime: real hours worked can be higher than contracted hours.
- Comparing gross with net: salary-to-hourly gives a gross rate unless tax is modelled separately.
- Using 260 days blindly: daily and hourly comparisons should reflect paid time, unpaid time and working pattern.
Related glossary terms
These terms help explain salary conversion and hourly pay comparisons.
Salary to hourly rate FAQs
What is the hourly rate for a £30,000 salary?
Using 37.5 hours per week and 52 paid weeks, £30,000 is about £15.38 per hour before tax and deductions.
What is the hourly rate for a £40,000 salary?
Using 37.5 hours per week and 52 paid weeks, £40,000 is about £20.51 per hour before tax and deductions.
Is hourly rate before tax?
Yes, when calculated from gross salary. Your after-tax hourly equivalent will be lower once PAYE, NI and other deductions are considered.
Should I include lunch breaks?
Use the hours you are paid for. If unpaid lunch breaks are excluded from contracted paid hours, do not include them in paid working hours.