Calculator inputs
The overtime calculator takes 6 inputs:
- Annual gross salary — your contractual gross
- Normal weekly hours — typically 37.5 or 40
- Overtime hours — for the specific pay period
- Overtime rate multiplier — 1x / 1.25x / 1.5x / 1.75x / 2x
- Region — England/Wales/NI or Scotland
- Tax year
Outputs
- Net overtime pay — the headline figure
- Normal hourly rate — your salary divided by (weekly hours × 52)
- Overtime hourly rate — normal hourly × multiplier
- Gross overtime — overtime hours × overtime hourly rate
- Income Tax + NI — at your marginal rate
- Net overtime pay — gross minus deductions
- Effective net rate / overtime hour — useful for comparing "is the time worth it"
Marginal rate by band
| Annual income | Marginal IT + NI | Net per £100 OT |
|---|---|---|
| Under £12,570 | 0% + 8% = 8% | £92 |
| £12,571–£50,270 | 20% + 8% = 28% | £72 |
| £50,271–£100,000 | 40% + 2% = 42% | £58 |
| £100,001–£125,140 | 60% + 2% = 62% | £38 |
| £125,140+ | 45% + 2% = 47% | £53 |
The calculator detects your band based on annual salary and applies the right marginal rate.
Worked example 1 — £30,000 earner, 5 hours at 1.5x
- Normal hourly: £30,000 / (37.5 × 52) = £15.38/hr
- Overtime hourly: £15.38 × 1.5 = £23.08/hr
- Gross overtime: 5 × £23.08 = £115
- At basic-rate marginal (28%): tax + NI ~£32
- Net overtime: £83
- Effective net rate: £16.60/hr (vs £11.08 normal-rate net)
Worked example 2 — £45,000 earner, 5 hours at 1.5x
- Normal hourly: £45,000 / 1950 = £23.08/hr
- Overtime hourly: £34.62/hr
- Gross overtime: 5 × £34.62 = £173
- At basic-rate marginal (still under £50,270): £49 tax + NI
- Net overtime: £124
- Effective net rate: £24.80/hr
Worked example 3 — £75,000 earner, 5 hours at 1.5x
- Normal hourly: £38.46/hr
- Overtime hourly: £57.69/hr
- Gross overtime: 5 × £57.69 = £288
- At higher-rate marginal (42%): £121 tax + NI
- Net overtime: £167
- Effective net rate: £33.40/hr
Notice: the higher earner's net per hour is higher (more cash), but the tax bite is also higher. At £75k, the effective net rate is £33.40/hr — comparable to many freelance hourly rates.
The £100k taper warning
For workers around £100,000, overtime is unusually punitive:
- £100k base + 5 hours OT at 1.5x for 100k earner = £384 gross OT
- At 62% effective marginal rate: £238 tax + NI = £146 net
- Effective net rate: £29.20/hr
That's £29.20/hr for hours that took skill and effort. Worth knowing — at £100k overtime is often better declined or sacrificed into pension.
Combining with pension sacrifice
If your normal salary leaves headroom in the basic-rate band, but the overtime pushes you into higher rate, consider pension sacrifice:
- The sacrifice reduces threshold-relevant income
- Overtime stays in basic rate
- Effective tax saving on the overtime: 14 percentage points (42% → 28%)
The salary sacrifice calculator helps quantify.
When the calculator overestimates
PAYE applies tax cumulatively per pay period. An unusually high overtime month may produce more PAYE deduction than the calculator's annualised marginal-rate result. The difference rebalances over subsequent pay periods — the annual position matches the calculator.
If you've just had a big-overtime month and the deduction looks higher than the calculator predicted: the calculator is correct annually. PAYE will rebalance within 2-3 months.
Tips
- Annualise overtime — divide by 52 (or your pay frequency) to see the steady-state per-period figure
- Use the multiplier consistently — don't enter "5 hours at 2x" when it's actually "5 hours including time-and-a-half" (different gross)
- Update normal hours if you have annualised contracts — some shift workers have non-standard normal hours; the calculator assumes you divide by 37.5 × 52 by default
In short
The overtime calculator applies your marginal tax rate to overtime gross. Effective net per £100 of overtime ranges from £92 (under-allowance) to £38 (in £100k taper). Use the "effective net rate per overtime hour" output to compare time invested vs cash gained. For broader take-home modelling, see Take-Home Pay Calculator.