Hourly Wage Tax Calculator
Our free hourly wage calculator converts any hourly rate into an annual salary, monthly pay, weekly earnings, and daily income — with full income tax and National Insurance deductions applied for 2026/27. Whether you are negotiating a contract rate or comparing a salaried offer with hourly work, this calculator gives you the complete picture instantly.
Hourly Wage Tax Calculator
Convert your hourly rate to an annual salary and see your take-home pay for 2026/27.
How to Convert an Hourly Rate to Annual Salary
The standard conversion for a full-time employee in the UK is based on 52 weeks multiplied by your contracted weekly hours. For a 40-hour week this gives 2,080 working hours per year. Multiply your hourly rate by 2,080 to find your equivalent gross annual salary. Part-time workers should multiply by their actual contracted hours instead.
A rate of £18 per hour on a standard 40-hour week produces a gross annual salary of £37,440. After income tax of £4,974 and National Insurance of £1,995, your annual take-home is approximately £30,471 — or roughly £2,539 per month.
UK Minimum Wage Rates 2026/27
The National Living Wage for workers aged 21 and over is £12.71 per hour from April 2026. The National Minimum Wage for 18 to 20-year-olds is £10.85 per hour, and for 16 and 17-year-olds it is £8.00 per hour. Apprentices in their first year or under 19 also receive £8.00 per hour. Any employer paying below these rates is in breach of employment law.
Checking your effective hourly rate against the National Living Wage is straightforward using this calculator — enter your weekly or monthly salary and your contracted hours, and the hourly equivalent is displayed immediately.
Hourly vs Salaried Employment
Hourly workers often receive overtime pay at 1.5x or 2x their standard rate, which can significantly boost annual earnings above the standard conversion. Salaried employees, by contrast, may work additional hours without extra pay, meaning the effective hourly rate is often lower than it appears. When comparing offers, ask for the contracted hours and use this calculator to put both on the same footing.
Self-employed contractors and freelancers should also account for employer National Insurance (which they bear themselves), loss of employer pension contributions, holiday pay (28 days statutory minimum), and the cost of their own insurance. A gross hourly rate of £25 for a freelancer is not equivalent to an employed rate of £25 — the employed equivalent is closer to £18–£20 once these factors are considered. Our Take-Home Pay Calculator lets you model the salaried equivalent side by side.
Frequently Asked Questions
A standard full-time employee working 37.5 hours per week has 1,950 working hours per year. A 40-hour week gives 2,080 hours. These figures exclude bank holidays; including the eight statutory bank holidays reduces the figures by 60 or 64 hours respectively.
If you are an employee, holiday pay is typically included in your annual salary — you still receive pay during your 28 days of statutory holiday. Hourly workers or zero-hours contract workers may receive holiday pay separately as a 12.07% uplift on their hourly rate, which should be included when converting to an annual equivalent.
Multiply your monthly gross pay by 12 to get your annual salary, then divide by your annual contracted hours. For example, £2,500 per month × 12 = £30,000 per year ÷ 1,950 hours = £15.38 per hour.
No. The National Living Wage applies to workers aged 21 and over and is set at a higher rate. The National Minimum Wage covers younger workers and apprentices at lower rates. Both are legally enforced floors, not targets — many employers pay above these levels.
Your gross hourly rate is what your employer pays before deductions. Your net hourly rate is what you actually take home after income tax and National Insurance. At £18 per hour gross (£37,440 annually), the net equivalent is approximately £14.65 per hour. Use our Income Tax Calculator to see the breakdown for any salary level.
How to Use the Hourly Wage Tax Calculator
Enter your hourly rate and select how many hours per week you work. The calculator annualises your income using 52 weeks per year to produce the equivalent gross annual salary, then applies standard 2026/27 PAYE rates to show your take-home pay. This is useful for comparing an hourly contract with a salaried offer, or for understanding your net earnings if you are paid by the hour rather than a fixed salary.
The National Living Wage for 2026/27 is £12.71 per hour for workers aged 21 and over. For 18-20 year olds, the National Minimum Wage is £10.85; for under-18s and apprentices, it is £8.00. If your hourly rate is close to the minimum wage level, check that your contracted hours reflect paid working time accurately — HMRC has increasingly focused on minimum wage compliance for workers in sectors where unpaid time (travel between sites, waiting time, training) can erode effective hourly pay.
Self-employed contractors and freelancers should note that the calculator uses employed PAYE rates. Self-employed workers pay Class 4 National Insurance on profits (at 9% between the Lower and Upper Profits Limit and 2% above), plus Class 2 NI at a flat weekly rate. Income tax applies on the same basis, but the NI saving versus employment can be meaningful at higher income levels.
For zero-hours contract workers, use an average of your typical weekly hours to get a representative annual estimate. In slow weeks your actual take-home will be lower; in busy weeks, higher. Your employer calculates PAYE on each pay period individually, so your tax is always calculated on actual earnings rather than an average — this means there is no year-end reconciliation needed for hours variation alone.
Important Information
This calculator is provided for general information and planning purposes only. It does not constitute financial or tax advice and should not be relied upon as such. Figures are indicative estimates based on simplified, publicly available criteria and stated assumptions. Actual results depend on your full circumstances. See our Disclaimer for further information.