Hourly to Annual Pay: Salary Packaging Services and Your Take-Home Pay

Converting Hourly to Annual Pay

Understanding how your hourly rate translates into annual pay is essential whether you are negotiating a salary, comparing job offers, or planning your budget. The standard formula used across Australia is straightforward: multiply your hourly rate by the number of hours you work each week, then multiply by 52 weeks. For a full-time employee working the typical 38-hour week, the calculation is:

Annual gross pay = hourly rate × 38 hours × 52 weeks

This gives your gross annual income before tax, the Medicare levy, and any deductions. It also assumes you work the same number of hours every week with no unpaid overtime, penalty rates, or allowances. If you work fewer or more hours, adjust the weekly figure accordingly. For example, a part-time employee working 20 hours per week would use 20 instead of 38.

To see your figures in action, try the timesheet where you can enter your base hourly rate and toggle casual loading. The tool also shows your fortnightly pay, which is simply your weekly pay multiplied by two. Knowing your fortnightly amount helps with budgeting and comparing to salary packaging services that may offer pre-tax deductions.

The National Minimum Wage vs Award Rates

The Fair Work Commission sets the National Minimum Wage each year. From 1 July 2026, the minimum is $26.44 per hour, or $1,004.90 per week for 38 hours. However, most employees are covered by an award or enterprise agreement that sets higher minimum rates for their industry or role. Award rates vary by classification, experience, and type of work. The National Minimum Wage is a floor; you cannot be paid less than this unless you are an award-free employee.

If you are comparing a salary offer to an hourly rate, remember that the annual figure from the formula is only an estimate. Your actual pay may differ if your award includes penalty rates, shift allowances, or overtime. For more details on award pay, check the pay guides provided by the Fair Work Ombudsman. The minimum wage page also explains the current rates and how they apply.

Casual Loading and Fortnightly Pay

Casual employees receive a loading on top of their base hourly rate to compensate for not receiving paid sick leave or annual leave. The standard casual loading is 25%. For the National Minimum Wage, this means a casual rate of $33.05 per hour. When converting to annual pay, apply the loading to the hourly rate first. For example, a casual earning $30 per hour base would have a loaded rate of $37.50 per hour. Then use the formula: $37.50 × 38 × 52 = $74,100 gross annual.

Your fortnightly pay is simply your weekly pay doubled. For a full-time employee on the minimum wage, weekly pay is $1,004.90, so fortnightly pay is $2,009.80 before tax. Casual employees will have a higher fortnightly amount due to the loading. Remember that casual loading is not a bonus; it replaces entitlements you would otherwise receive as a permanent employee. Learn more on the casual loading page.

Tax and Superannuation

Once you have your gross annual pay, you can estimate your take-home amount using the 2026–27 resident tax rates. The tax-free threshold is $18,200. Income from $18,201 to $45,000 is taxed at 15%, then 30% up to $135,000, 37% up to $190,000, and 45% above that. The Medicare levy is generally 2% of your taxable income, though reductions may apply for lower incomes. Note that the 2026–27 Medicare levy reduction thresholds were not confirmed at the time of this guide, so the estimate uses the 2025–26 single thresholds.

Superannuation is paid by your employer on top of your ordinary earnings. The super guarantee rate is 12% from 1 July 2026, up to the maximum contribution base of $270,830 per year. For example, if your annual gross pay is $80,000, your employer contributes an additional $9,600 to your super fund. Super is not deducted from your pay; it is an extra cost. Salary packaging services can sometimes reduce your taxable income by allowing you to pay for certain items (like a car or laptop) from pre-tax dollars, but this does not affect the super guarantee calculation on your ordinary earnings. For more on how super interacts with packaging, see super and packaging.

Using Salary Packaging Services

Salary packaging services allow you to sacrifice part of your pre-tax salary to pay for eligible benefits, reducing your taxable income. Common examples include novated car leases, laptops, and childcare. While packaging can lower your tax bill, it does not change the way your hourly rate converts to annual pay. The annual gross figure from the formula remains the same; packaging simply redirects some of that gross amount before tax is calculated.

When comparing job offers, consider whether salary packaging services are available. Some employers offer packaging as a benefit, which can increase your take-home pay compared to a similar gross salary without packaging. However, the estimates on this site do not include salary packaging, HELP repayments, or the Medicare levy surcharge. Always consult a tax professional for your personal situation.

For a quick reference on average earnings, the Australian Bureau of Statistics reports that full-time adult ordinary time earnings were $2,083.70 per week in May 2026. This is an average across all industries and states, not a median for your specific job. Use average pay to see how your rate compares, but remember that averages can be skewed by high earners. Your best guide is the award or agreement that covers your role.

Finally, remember that the formula here is a starting point. Your actual annual pay may differ due to unpaid leave, overtime, or irregular hours. Use the timesheet to experiment with different scenarios, and always check your pay slip against your award. The reference tables provide additional tax and super figures to help you plan.