Why use this calculator
Pay is quoted in whatever unit flatters the employer. Agencies advertise hourly, corporates advertise annual, and hospitality advertises per shift, which makes two offers almost impossible to compare in your head. Converting everything to a common basis is the only way to see that a 95,000 dollar role at 45 hours a week pays less per hour than an 85,000 dollar role at 38.
The hourly figure also tells you whether overtime, a side job or a longer commute is actually worth taking, and it is the number a contractor must start from before loading in leave, retirement contributions, insurance and downtime. Including the employer retirement contribution matters too, because an Australian job quoted as a total package hides a 12 per cent difference in the cash that reaches your bank account.
How to use it
- Enter the gross amount you are paid from your contract or the job advertisement, before any tax.
- Choose the period that amount is quoted on, which is printed on your payslip next to the gross figure.
- Enter your contracted ordinary hours per week from the contract rather than the hours you actually work, because the contracted figure is what the salary legally buys.
- Enter the days you normally work in a week, which sets the day rate used for leave loading and contract quotes.
- Leave paid weeks at 52 unless you are a contractor who takes unpaid weeks off, in which case reduce it to the weeks you genuinely invoice.
- Finally set the employer retirement contribution, which in Australia is the 12 per cent super guarantee, or zero if the quoted figure already includes it.
What each result means
- Annual salary
- Your gross yearly pay before income tax and before any employer retirement contribution is added.
- Estimated take-home pay
- Your annual salary after resident income tax, the low income tax offset and the Medicare levy, assuming no study loan and no salary sacrifice. It is the figure to budget from rather than the gross salary.
- Monthly pay
- One twelfth of the annual figure, which is the basis rent, mortgages and subscriptions are billed on.
- Fortnightly pay
- One twenty-sixth of the year. Two months in every year contain three fortnightly pays, which is worth budgeting for.
- Weekly pay
- Gross pay for one week, useful for comparing against award rates and weekly rent.
- Daily rate
- What a single working day of your time is worth, and the starting point for any day-rate contract quote.
- Hourly rate
- The single most comparable number between any two jobs, because it normalises away different hours and different quoting habits.
- Employer super contribution
- Money your employer pays into your retirement fund on top of salary. It is real pay you cannot spend yet.
- Total package including super
- Salary plus the employer contribution, which is the figure some employers advertise. Never compare a package against a bare salary.
- Hours worked in a year
- Your annual hours. Multiply by the hourly rate to check the conversion, and compare against a standard 1,976 hour year.
The formula
Annual = amount multiplied by the number of periods in a year
Monthly = annual divided by 12
Fortnightly = annual divided by 26
Weekly = annual divided by paid weeks
Daily = annual divided by (days per week multiplied by paid weeks)
Hourly = annual divided by (hours per week multiplied by paid weeks)
Employer contribution = annual multiplied by the contribution rate, which is the 12 per cent superannuation guarantee in Australia from 1 July 2025
Total package = annual plus the employer contribution
How this number is used in practice
The hourly rate is where job offers stop looking alike. A promotion from a 38 hour role on 85,000 dollars to a 50 hour management role on 110,000 dollars looks like a 29 per cent pay rise and is in fact a small pay cut per hour worked.
That does not automatically make it a bad move, because titles and experience compound in ways hourly pay does not, but it should be a decision made knowingly rather than one made because the annual number was bigger. Run both offers through the converter, compare the hourly figures, and then decide what the extra twelve hours a week are buying you.
Contractors need the paid weeks field more than anyone. An employee on 100,000 dollars gets four weeks of annual leave, ten or so public holidays and sick leave without losing a cent, while a contractor billing the equivalent hourly rate loses every one of those weeks.
Setting paid weeks to 46 rather than 52 is the minimum honest adjustment, and most experienced contractors load a further 25 to 40 per cent on top for retirement contributions, insurance, unbilled admin and the gaps between engagements. Working backwards from an employee salary to the hourly rate you must charge is the calculation that stops a new contractor underpricing themselves for a year.
In Australia the difference between a salary and a package is 12 per cent, and recruiters are not always precise about which one they are quoting. An advertisement saying 95,200 dollars package is the same as 85,000 dollars plus super, and a candidate who assumes it means 95,200 dollars in salary will be surprised at their first payslip.
Always ask which basis the number is on before negotiating, and set the contribution rate in this calculator to zero if the figure you were quoted already includes it.
Worked examples
A salaried role paying 85,000 dollars a year for 38 hours across five days, with 12 per cent super
43.01 dollars an hour, 1,634.62 dollars a week and a 95,200 dollar total package
A contractor charging 65 dollars an hour for 38 hours a week but only invoicing 46 weeks
113,620 dollars a year gross, which is 9,468.33 dollars a month before tax and expenses
A 110,000 dollar management role that really runs to 50 hours a week
42.31 dollars an hour, which is below the 38 hour role paying 85,000 dollars
When people use it
- Comparing a salaried offer against an hourly or day-rate contract on the same basis
- Working out the hourly rate a contractor must charge to match an employee salary
- Checking whether a promotion with longer hours is a real pay rise per hour
- Converting an advertised annual figure into the weekly amount your budget runs on
- Separating an Australian total package from the base salary before negotiating
Tips
- Always ask whether an Australian salary figure includes super. The difference is 12 per cent of your cash pay.
- Enter the hours you actually work, not the contracted ones, if you want the honest hourly rate of a role with routine unpaid overtime.
- A contractor should set paid weeks to about 46 to allow for leave and public holidays, then add a loading for retirement contributions and insurance.
- Two months a year contain three fortnightly pays. Treat those as the months you top up savings rather than the months you spend more.
- Compare the hourly rate, never the annual salary, when the two jobs have different hours. The annual figure hides the trade.
- Before accepting a longer commute for more pay, divide the extra pay by the extra hours travelled. Commuting is unpaid time.
What it assumes, and where it stops being accurate
- All figures are gross. Income tax, the Medicare levy, study loan repayments and any salary packaging are excluded, so take-home pay will be materially lower.
- Assumes every week is paid at the same rate. Overtime, penalty rates, shift loadings, commissions and bonuses are excluded.
- A fortnight is treated as one twenty-sixth of a year and a month as one twelfth, which is how payroll systems calculate them. Neither is exactly four weeks.
- Excludes the value of non-cash benefits such as a vehicle, phone, parking, insurance or bonus schemes, which can be worth thousands.
- The employer contribution is applied to the whole salary and ignores the quarterly maximum contribution base that caps super for very high earners.
- Assumes hours worked equal hours paid. Unpaid overtime does not change the salary but it does change the real hourly rate, so enter the hours you actually work if that is what you want to measure.
Terms used on this page
- Gross pay
- Pay before income tax and any other deduction is taken out.
- Total package
- Base salary plus employer-funded extras such as superannuation, most often quoted in Australia.
- Superannuation guarantee
- The minimum percentage of ordinary earnings an Australian employer must pay into a retirement fund, 12 per cent from 1 July 2025.
- Ordinary hours
- The contracted weekly hours a salary is paid for, before any overtime or penalty rates.
- Day rate
- A fixed amount for one day of work, the common pricing unit for consultants and tradespeople.
Questions people ask
- How many working hours are there in a year?
- A 38 hour week across 52 weeks is 1,976 hours, and a 40 hour week is 2,080. Both count paid leave and public holidays as worked time. Strip out four weeks of leave and about ten public holidays and a full-time employee is actually present for roughly 1,750 to 1,850 hours.
- Should I use 52 weeks or fewer?
- Use 52 for a salaried employee, because annual leave and public holidays are paid. Use 46 or so for a contractor or anyone paid only for the weeks they work, since unpaid time off is genuinely unpaid and pretending otherwise overstates your effective hourly rate by more than ten per cent.
- Does this show my take-home pay?
- No. Every figure here is gross, before income tax, the Medicare levy and any study loan repayment. Use a salary after tax or paycheck calculator for net pay. Gross conversion is still the right first step, because tax is applied to the annual figure this tool produces.
- How much more should a contractor charge than an employee?
- As a rough guide, take the employee hourly rate and add 25 to 40 per cent. That covers the retirement contribution the employer would have paid, annual and sick leave, public holidays, insurance, unbilled administration and the gaps between contracts. High-demand specialists command more, and long stable engagements justify less.
- Why is my monthly pay not four weekly pays?
- Because a year has 52 weeks but only 12 months, so an average month is about 4.33 weeks. Multiplying weekly pay by four understates monthly pay by roughly eight per cent, which is why payroll divides the annual salary by 12 rather than multiplying the weekly figure.
- Is a bigger total package always a better offer?
- Not necessarily. A package figure can bundle superannuation, a vehicle allowance, parking or insurance, so the salary that actually reaches your account may be lower than a smaller headline elsewhere. Ask for the base salary in writing and compare base against base, then value the extras separately.
Use this with
Salary Calculator answers one part of the question. These pick up where it stops: Salary After Tax Calculator, Hourly to Salary Converter, Freelance Hourly Rate Calculator, Freelance Rate Calculator and Paycheck Calculator.
Where these figures come from
This calculation is jurisdiction-neutral arithmetic. No country-specific rules are applied.
- Fair Work Ombudsman - pay and conditions. Australian award rates, ordinary hours and entitlements
- GOV.UK - National Minimum Wage rates. UK hourly minimums used to sanity check converted rates
- US Department of Labor - Fair Labor Standards Act. US rules on hours worked and overtime
- ATO: Super guarantee and contribution caps. SG rate 12% and the maximum contribution base
Salary Calculator produces an estimate for general information. It is not financial, tax, medical, legal or engineering advice. read the full disclaimer. Spotted a wrong number? Report it and it gets fixed. The form picks up this calculator and the inputs you used.