How to Convert Hourly Pay to Annual Salary

To convert hourly pay to an annual salary, multiply the hourly rate by the hours you work per week and by the number of paid weeks per year: annual salary = hourly rate × hours per week × paid weeks. At 20 an hour, 40 hours a week and 52 paid weeks, that is 41,600 a year before tax.

The formula explained

Annual = hourly × hours per week × paid weeks per year

• Hours per week: your contracted hours, not the hours your office is open. A 9-to-5 day with an unpaid lunch break is 7 or 7.5 paid hours, not 8.
• Paid weeks: 52 if your holidays are paid, which is the case for most salaried jobs. Use fewer weeks if you take unpaid leave or only work part of the year, as many contractors do.

From the annual figure you can get every other period:

• Monthly = annual ÷ 12
• Weekly = annual ÷ paid weeks
• Hourly = annual ÷ (hours per week × paid weeks)

Everything in this guide is gross pay, before income tax and other deductions. Your take-home pay depends on your country, your tax situation and any benefits deducted from your pay.

Worked examples

1. Full time, 40 hours a week

20 × 40 × 52 = 41,600 per year Monthly: 41,600 ÷ 12 = 3,466.67 Weekly: 20 × 40 = 800

2. From a salary offer back to an hourly rate

A job pays 50,000 a year for 40 hours a week. The year has 40 × 52 = 2,080 paid hours, so 50,000 ÷ 2,080 = 24.04 per hour. This is the number to use when you compare the offer with an hourly job.

3. Unpaid weeks and overtime

At 20 an hour and 40 hours a week, but only 48 paid weeks: 20 × 40 × 48 = 38,400. That is 3,200 less than with 52 paid weeks, just because of 4 unpaid weeks.

Now take the full-time example again and add 5 hours of overtime per week paid at 150% ("time and a half"): 20 × 1.5 × 5 × 52 = 7,800 extra, so 49,400 per year in total. The Hourly wage calculator handles overtime at 125%, 150% or any other rate.

A quick mental approximation

For a 40-hour week, hourly rate × 2,000 gives a rough yearly figure (it assumes 50 paid weeks). At 20 an hour: about 40,000, compared with the exact 41,600 for 52 weeks. It is fine for comparing job ads at a glance, but use the full formula for anything that matters.

Quick method with our tools

1. Open the Salary calculator.
2. Enter your pay and choose its period: hourly, daily, weekly, monthly or yearly.
3. Set your real hours per week, days per week and paid weeks per year.
4. Read the equivalent amount for every other period.
5. For overtime, use the Hourly wage calculator and enter your overtime hours and rate.
6. To see what a raise is worth, use the Percentage calculator: a 3% raise on 20 an hour gives 20.60, which is 42,848 a year at 40 hours and 52 weeks.

For more percentage calculations, see how to calculate percentages.

Common mistakes

• Using 52 weeks when some are unpaid. Contractors and hourly workers who are not paid for holidays should use their real number of paid weeks.
• Counting unpaid breaks as working hours, which overstates the hourly rate when you convert back from a salary.
• Monthly = weekly × 4. A month has about 4.33 weeks on average (52 ÷ 12), so multiplying by 4 undercounts: 800 × 4 = 3,200 instead of 3,466.67.
• Comparing gross with net. A salary offer is usually quoted gross; your payslip shows both. Compare like with like.
• Forgetting benefits. Two offers with the same salary can differ in paid leave, pension contributions or bonuses, which this formula does not capture.