Salary vs Hourly Rate Calculator
To compare two offers you have to match the denominators. A 60,000,000 salary with 18% of benefits is a 70,800,000 package. Divided by 2,080 paid hours a year that is 34,038 an hour — but do not hold that against an hourly offer, because a contractor cannot bill 2,080 hours. At 1,500 billable hours, 70,800,000 over 1,500 gives 47,200 as the matching rate. An offer of 45,000 an hour is 67,500,000 a year, 3,300,000 short.
Your numbers
Hourly rate to match
47,200
Salary per paid hour
34,038
Yearly take at that rate
67,500,000
Gap between the two
-3,300,000
Formula
Hourly rate to match = Annual salary × (1 + Benefits on top ÷ 100) ÷ Billable hours a year
What you count in the benefits percentage decides the answer — employer social contributions, retirement, paid leave, insurance and equipment together commonly land between 15% and 30%. Billable hours are not working hours: 20 to 30 of a 40-hour week is typical, before holidays and gaps between contracts come out. Both sides are kept before tax here, so differences in how the two employment forms are taxed and deducted are not in it. To go the other way — from a target income to a rate — use the freelance hourly rate page.
What to enter
| Input | Default | Accepted range |
|---|---|---|
| Annual salaryThe contracted yearly salary, before benefits and before tax. | 60,000,000 | 0 and up |
| Benefits on top (%)What the employer adds on top — social contributions, retirement, paid leave. | 18 | 0 ~ 100 |
| Paid hours a year (h)Paid hours counted in a year; a 40-hour week makes 2,080. | 2,080 | 0 ~ 4,000 |
| Hourly rate offeredThe hourly rate on the offer you are comparing. | 45,000 | 0 and up |
| Billable hours a year (h)Billable hours across the year — the number you divide by. | 1,500 | 0 ~ 4,000 |
Step by step
Quick reference table
Results when only Annual salary changes and everything else stays put.
| Annual salary | Hourly rate to match | Salary per paid hour | Yearly take at that rate |
|---|---|---|---|
| 30,000,000 | 23,600 | 17,019 | 67,500,000 |
| 45,000,000 | 35,400 | 25,529 | 67,500,000 |
| 60,000,000 | 47,200 | 34,038 | 67,500,000 |
| 90,000,000 | 70,800 | 51,058 | 67,500,000 |
| 120,000,000 | 94,400 | 68,077 | 67,500,000 |
What each result means
| Result | At default values |
|---|---|
| Hourly rate to matchThe rate needed to match that package across billable hours only. | 47,200 |
| Salary per paid hourThe full package over paid hours; not directly comparable to an hourly offer. | 34,038 |
| Yearly take at that rateA year at that rate with every billable hour filled. | 67,500,000 |
| Gap between the twoThe hourly side less the salary package; negative means the salary wins. | -3,300,000 |
Common mistakes
What you count in the benefits percentage decides the answer — employer social contributions, retirement, paid leave, insurance and equipment together commonly land between 15% and 30%. Billable hours are not working hours: 20 to 30 of a 40-hour week is typical, before holidays and gaps between contracts come out. Both sides are kept before tax here, so differences in how the two employment forms are taxed and deducted are not in it. To go the other way — from a target income to a rate — use the freelance hourly rate page.
Glossary
- Annual salary
- The contracted yearly salary, before benefits and before tax.
- Benefits on top
- What the employer adds on top — social contributions, retirement, paid leave.
- Paid hours a year
- Paid hours counted in a year; a 40-hour week makes 2,080.
- Hourly rate offered
- The hourly rate on the offer you are comparing.
- Billable hours a year
- Billable hours across the year — the number you divide by.
- Hourly rate to match
- The rate needed to match that package across billable hours only.
- Salary per paid hour
- The full package over paid hours; not directly comparable to an hourly offer.
- Yearly take at that rate
- A year at that rate with every billable hour filled.
- Gap between the two
- The hourly side less the salary package; negative means the salary wins.
Frequently asked questions
Q. How is Salary vs Hourly Rate Calculator calculated?
Hourly rate to match = Annual salary × (1 + Benefits on top ÷ 100) ÷ Billable hours a year — To compare two offers you have to match the denominators. A 60,000,000 salary with 18% of benefits is a 70,800,000 package. Divided by 2,080 paid hours a year that is 34,038 an hour — but do not hold that against an hourly offer, because a contractor cannot bill 2,080 hours. At 1,500 billable hours, 70,800,000 over 1,500 gives 47,200 as the matching rate. An offer of 45,000 an hour is 67,500,000 a year, 3,300,000 short.
Q. Can you walk through an example?
With Annual salary 60,000,000, Benefits on top 18%, Paid hours a year 2,080h, Hourly rate offered 45,000, Billable hours a year 1,500h, the answer is Hourly rate to match 47,200.
Q. What do I need to enter?
Enter Annual salary, Benefits on top, Paid hours a year, Hourly rate offered, Billable hours a year. The result recalculates as you type, and an empty box counts as zero.
Q. How much does the answer move if I change a number?
Changing only Annual salary moves the answer to Annual salary 30,000,000 → Hourly rate to match 23,600 and Annual salary 120,000,000 → Hourly rate to match 94,400. The table below lays out five steps.
Q. How are the numbers rounded?
Money is shown to the nearest whole unit, percentages to one decimal place and everything else to two. What you see is rounded; the calculation itself carries the unrounded value forward.
Q. Anything to watch out for?
What you count in the benefits percentage decides the answer — employer social contributions, retirement, paid leave, insurance and equipment together commonly land between 15% and 30%. Billable hours are not working hours: 20 to 30 of a 40-hour week is typical, before holidays and gaps between contracts come out. Both sides are kept before tax here, so differences in how the two employment forms are taxed and deducted are not in it. To go the other way — from a target income to a rate — use the freelance hourly rate page.
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