How do I calculate my annual salary from my hourly rate?

Multiply your hourly rate by your hours per week, then multiply by 52. For example, £18/hr × 37.5 hrs × 52 weeks = £35,100/year. This is the gross annual equivalent, useful when comparing a salaried role with an hourly or contract position. Remember to factor in holiday entitlement, sick pay and employer pension contributions when comparing the two.

What is the difference between hourly rate and hourly wage?

In everyday usage the terms overlap, but technically an hourly rate is typically used by contractors and freelancers who price their time for services, while hourly wage refers to what an employee earns as employment income. The calculation method is identical, but the context differs: contractors set their own rate and invoice for it, whereas employees are paid a wage by their employer.

How do contractors calculate their day rate?

Contractors typically calculate their day rate by dividing their desired annual income by the number of working days per year. With 52 weeks less 4 weeks holiday, that is 48 × 5 = 240 working days. A contractor targeting £80,000/year would charge £80,000 ÷ 240 = £333/day. Most contractors also add a margin for non-billable time, sick days, and employer costs they cover themselves.

Is hourly rate calculated on 37.5 or 40 hours in the UK?

There is no single standard, it depends on the working pattern for the role. Many UK office and professional roles use 37.5 hours per week (7.5 hours per day, Monday to Friday), while manufacturing, retail and some public-sector roles use 40 hours (8 hours per day). Always confirm the contracted hours when converting between salary and hourly rate, as the difference can be material.

What hourly rate should I charge as a freelancer UK?

As a UK freelancer, a useful starting point is to take your target annual income, add 20–30% for non-billable time and costs, then divide by your billable hours. For example, targeting £50,000 net: add 25% uplift for costs = £62,500 target, divide by 1,500 billable hours = £41.67/hr. Compare against ONS median hourly pay for your sector (approximately £17/hr across all UK workers in 2026).

Updated 6 April 2026

Hourly Rate Calculator · Free UK 2026/27

Calculate your salary-to-hourly rate or day rate, built for employees, contractors and freelancers. Updated 2026/27.

✓ Free to use✓ Day rate included✓ Contractor friendly✓ Instant results

Hourly Rate Calculator

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Results are gross figures before tax. Contractors: see IR35 calculator for net take-home estimates.

How to Calculate Your Hourly Rate

Quick Answer: To calculate your hourly rate from your salary, divide your annual salary by the number of hours you work per year. For a 37.5-hour week: annual salary ÷ 1,950 hours. For a 40-hour week: annual salary ÷ 2,080 hours. Contractors typically calculate a day rate by dividing annual income by 240 working days.

Salary to Hourly Rate

The standard formula divides annual salary by the number of working hours in a year. The two most common full-time patterns in the UK are 37.5 hours/week (1,950 hours/year) and 40 hours/week (2,080 hours/year). This calculator lets you choose your hours and gives you hourly, daily, weekly and monthly figures instantly.

Formula

Hourly Rate = Annual Salary ÷ (Hours per Week × 52) | Day Rate = Annual Salary ÷ Working Days per Year

£60,000 ÷ 1,950 hrs = £30.77/hr | £60,000 ÷ 240 days = £250/day

Worked Example: Contractor targeting £80,000/year

Target annual income£80,000

Working days per year (÷ 240)÷ 240

Day rate£333.33

Hourly rate (÷ 8)£41.67

Weekly rate (5 days)£1,666.67

Day rates shown are gross. Contractors operating through a limited company must also account for IR35, employer NI and corporation tax.

Positioning: Hourly Rate vs Hourly Wage

An hourly rate is the price a contractor or freelancer charges a client for their time, it is a pricing term used in self-employment and business-to-business engagements. An hourly wage is what an employer pays an employee and is governed by minimum wage legislation. The mathematics are identical, but the context, tax treatment and legal framework differ significantly. Contractors pricing their rate should account for non-billable time, business costs, holiday and sick leave they fund themselves.

Frequently Asked Questions

Divide your annual salary by the number of hours you work in a year. For a 37.5-hour week (1,950 hours per year), a £45,000 salary gives £45,000 ÷ 1,950 = £23.08/hr. For a 40-hour week (2,080 hours), the same salary gives £21.63/hr. The result is always a gross figure, before income tax and National Insurance are deducted through PAYE.