Salary Calculator

Convert between annual salary and hourly rate, with detailed breakdowns

Last reviewed: July 2026How we build & verifyEstimate only. Verify important decisions with a qualified professional

Convert From

Annual Salary ($)

Hours per Week

Weeks per Year

How it works

Converts between annual, monthly, and hourly pay, and estimates take-home pay after payroll taxes and deductions. Different deductions come out of different bases, which is why net pay is rarely a simple percentage of gross.

Formula

Hourly = Annual / (Hours per week × Weeks worked)
Net = Gross − Pre-tax deductions − Payroll tax − Income tax

Variables

Grosstotal pay before any deduction
Pre-tax deductionsretirement contributions, health premiums, HSA
2,080standard full-time hours per year (40 × 52)
Nettake-home pay actually deposited

Worked example

Inputs: $85,000 salary, $5,100 retirement contribution, $3,600 health premium, 7.65% payroll tax, 14% effective income tax

Hourly equivalent: 85,000 / 2,080 = 40.87
Income-tax base: 85,000 − 5,100 − 3,600 = 76,300
Payroll-tax base excludes the health premium but not retirement: 85,000 − 3,600 = 81,400
Payroll tax: 81,400 × 0.0765 = 6,227.10
Income tax: 76,300 × 0.14 = 10,682.00
Net: 85,000 − 5,100 − 3,600 − 6,227.10 − 10,682.00 = 59,390.90

Result: ≈ $59,391 net per year, about $4,949 per month, $40.87 per hour gross

Notes

In the US, traditional 401(k) contributions reduce income tax but not Social Security and Medicare tax. Section 125 health premiums reduce both. That asymmetry trips up most quick estimates.
Effective tax rate is what you actually pay across all brackets, and is always lower than your marginal bracket. Use effective for take-home, marginal for deciding on extra income.
Semi-monthly pay is 24 cheques a year; biweekly is 26. Biweekly gives two months with three cheques, which is a cash-flow quirk, not extra pay.
Contractors should add employer-side payroll tax and unpaid time off. A $60 per hour contract is not equivalent to a $124,800 salary once both are covered.

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Frequently Asked Questions

Divide the annual salary by 2080 (40 hours × 52 weeks). A $60,000 salary equals $28.85/hour. For a more accurate figure, subtract paid time off.

Gross salary is the total before deductions. Net (take-home) salary is what you actually receive after income tax, Social Security, Medicare, health insurance, and retirement contributions.

Almost always yes. The initial offer is rarely the company's best. A 5-10% bump at the start compounds over years of raises. Failing to negotiate can cost you hundreds of thousands over a career.

How it works

Formula

Hourly = Annual / (Hours per week × Weeks worked)
Net = Gross − Pre-tax deductions − Payroll tax − Income tax

Variables

Grosstotal pay before any deduction
Pre-tax deductionsretirement contributions, health premiums, HSA
2,080standard full-time hours per year (40 × 52)
Nettake-home pay actually deposited

Worked example

Inputs: $85,000 salary, $5,100 retirement contribution, $3,600 health premium, 7.65% payroll tax, 14% effective income tax

Hourly equivalent: 85,000 / 2,080 = 40.87
Income-tax base: 85,000 − 5,100 − 3,600 = 76,300
Payroll-tax base excludes the health premium but not retirement: 85,000 − 3,600 = 81,400
Payroll tax: 81,400 × 0.0765 = 6,227.10
Income tax: 76,300 × 0.14 = 10,682.00
Net: 85,000 − 5,100 − 3,600 − 6,227.10 − 10,682.00 = 59,390.90

Result: ≈ $59,391 net per year, about $4,949 per month, $40.87 per hour gross

Notes

In the US, traditional 401(k) contributions reduce income tax but not Social Security and Medicare tax. Section 125 health premiums reduce both. That asymmetry trips up most quick estimates.
Effective tax rate is what you actually pay across all brackets, and is always lower than your marginal bracket. Use effective for take-home, marginal for deciding on extra income.
Semi-monthly pay is 24 cheques a year; biweekly is 26. Biweekly gives two months with three cheques, which is a cash-flow quirk, not extra pay.
Contractors should add employer-side payroll tax and unpaid time off. A $60 per hour contract is not equivalent to a $124,800 salary once both are covered.

Salary Calculator

How it works

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Frequently Asked Questions

Salary Calculator

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