Daily Rate to Salary Calculator

No. Dividing a salary by around 260 working days ignores everything a salary includes for free: paid holiday, an employer pension, employer National Insurance, sick pay and other benefits. That is why this tool converts on billable days and applies a benefits uplift, rather than a flat 260-day split.

Multiply the day rate by the number of days you will actually bill to get gross annual income, then divide by one plus the benefits uplift to get the permanent-equivalent salary. For £400/day, 220 days and a 30% uplift: £400 × 220 = £88,000, then £88,000 ÷ 1.30 is about £67,700.

Most full-time contractors bill between 210 and 230 days a year once you subtract holidays, bank holidays, admin days and gaps between contracts. A permanent employee's year is around 260 working days, so billing 260 assumes you take no holiday and never have downtime, which is rarely realistic.

The 30% is a widely used rule of thumb for the value of the benefits and on-costs a permanent employee receives: paid holiday, employer pension, employer National Insurance, sick pay and perks. It is a convention, not an official figure, so it is fully editable. Roles with generous pensions and bonuses justify a higher figure; bare-bones roles a lower one.

No. Every figure here is gross, before income tax, National Insurance, expenses and any IR35 deductions. Use HMRC's tools or a take-home calculator to estimate what actually lands in your account, then use this tool to compare the headline rate against a permanent salary.

IR35 (off-payroll working) decides whether HMRC treats you as employed for tax on a given contract. Being inside IR35 reduces your take-home because tax and NI are deducted as if you were an employee. It does not change the gross day-rate-to-salary conversion shown here, but it heavily affects take-home, so check your status on GOV.UK.

Multiply the target salary by one plus the uplift, then divide by your billable days. To match £60,000 at 220 days and 30% uplift: £60,000 × 1.30 ÷ 220 = £355 a day. Enter a salary in the optional field and the tool does this for you and tells you whether your rate clears it.

Roughly, on money alone, but contracting carries risks a salary does not: no guaranteed work, no notice period, no redundancy pay and income that stops the moment you stop billing. Many contractors add a further premium on top of the equivalent rate to compensate for that risk.

Use the days you genuinely expect to bill. If you contract for six months, your billable days might be 110 to 120, which roughly halves the gross annual figure. The equivalent-salary ratio stays the same, but the annual total falls.

Indirectly, through the uplift. A permanent employer typically pays at least 3% into your pension automatically; as a contractor you must fund your own pension from the gross rate. If your target permanent role has a strong pension, raise the uplift to reflect it.

VAT is charged on top of your fee and passed to HMRC, so it is not part of your income and is excluded here. If you are VAT-registered, quote and invoice your day rate plus VAT, but compare salaries using the rate excluding VAT, which is what this tool uses.

Working through an umbrella company means employer NI, the apprenticeship levy and the umbrella's margin come out of your assignment rate before you are paid. This tool shows the gross assignment rate; umbrella deductions reduce take-home further, so treat the equivalent salary as a ceiling, not a promise.

It is a clear, honest estimate for comparing a rate against a salary, not a precise forecast. The two things that move the answer most are your billable days and your uplift, both of which are editable, and the scenario table shows how much your income swings as billable days change.

Many contractors do. The equivalent salary treats money like-for-like, but it does not price in the lack of job security, notice, redundancy pay or paid time off. A premium of 10 to 20% above the equivalent rate is common to compensate for that risk and the effort of finding work.

Sanity-check your billable days against last year's actual invoiced days, adjust the uplift to match the permanent role you are comparing with, then estimate your take-home separately for tax and IR35. If the equivalent salary beats your alternative comfortably, the rate is doing its job.