How to read the results
This calculator separates gross pay, estimated take-home pay, spendable pay after work-related costs, employer-paid compensation, actual working time and commuting time. That is why it shows several rates instead of one misleading true wage.
Headline hourly equivalent
Gross salary divided by contracted annual working hours. This is a simple salary-to-hours equivalent.
Net work rate
Estimated annual take-home pay divided by actual annual hours worked.
Time-committed rate
Estimated annual take-home pay divided by actual working hours plus commuting time.
Spendable work rate
Estimated annual take-home pay minus annual commute costs and unavoidable work costs, divided by working plus commuting time.
Total compensation rate
Gross salary, expected bonus and estimated employer pension contribution divided by actual annual working hours.
Worked example
Someone earning GBP 35,000, working 40 actual hours a week for 46.4 weeks, commuting 30 minutes each way for 3 days a week, paying GBP 45 a week to commute and GBP 10 a week in other unavoidable work costs would see different answers for different questions. The headline hourly equivalent is based on contracted hours, while the spendable work rate reflects estimated take-home pay after commute and work costs across both work and commute time.
Methodology and assumptions
The tax estimate uses 2026/27 Income Tax for England, Wales and Northern Ireland, annualised Class 1 employee National Insurance, the Personal Allowance taper above GBP 100,000, optional employee pension contributions and optional student loan deductions. It does not implement Scottish Income Tax, tax code adjustments, taxable benefits, childcare, marriage allowance, benefits in kind, bonus timing, director NI, irregular pay-period rounding or every payroll edge case.
- Personal Allowance: GBP 12,570, tapered by GBP 1 for every GBP 2 of adjusted net income above GBP 100,000.
- Income Tax: 20% basic rate up to GBP 37,700 of taxable income after allowances, 40% higher rate to GBP 125,140, then 45% additional rate.
- Employee NI: annualised category A estimate using 8% between GBP 12,570 and GBP 50,270, then 2% above GBP 50,270.
- Student loans: Plan 1 GBP 26,900, Plan 2 GBP 29,385, Plan 4 GBP 33,795, Plan 5 GBP 25,000 at 9%; Postgraduate Loan GBP 21,000 at 6%.
- Relief at source pension contributions are treated as gross pension contributions with basic-rate relief added by the pension provider. Higher-rate relief is not added to take-home pay here.
- Salary sacrifice pension contributions reduce taxable and NI pay in this estimator.
For the broader principle behind these measures, read the WorthMyTime methodology. For important decisions, also read the disclaimer.
FAQ
What is a true hourly rate?
A true hourly rate is a way to look beyond headline salary by comparing pay with the time and costs involved in doing a job. WorthMyTime shows several rates because different decisions need different measures.
Should commuting time count as work time?
Commuting time is not normally paid working time, but it is time committed to having that job. The time-committed rate includes commuting so you can see that perspective separately.
Should employer pension contributions count as pay?
Employer pension contributions are part of total compensation, but they are not immediate spendable income. The calculator shows them separately in the total compensation rate.
How are work costs treated?
The spendable work rate subtracts commuting costs and unavoidable work-related costs from estimated take-home pay before dividing by total committed time.
Is the calculator accurate for Scottish taxpayers?
No. This first version estimates Income Tax for England, Wales and Northern Ireland. Scottish Income Tax bands are different and will need a separate implementation.
Does overtime affect the result?
Overtime can affect the result if you include it in actual weekly hours or expected bonus. A dedicated overtime calculator is planned so overtime can be modelled more precisely.
Does student loan repayment reduce my effective hourly rate?
Student loan deductions reduce estimated take-home pay, so they affect the net, time-committed and spendable rates shown by this calculator.