The Salary Calculator

Pro-rata calculations

Recently, I’ve had a couple of requests from users of the site to have a pro-rata calculator on the site, so you can work out what your new pay would be if you go down to reduced hours or enter a job share of some sort. Unfortunately, I’ve not had time to make this new tool, but it is easy to use the existing calculator to work out your pro-rata pay.

For example, if you are working 20 hours a week instead of 37.5:

1. If you know the hourly rate for the job, use the Hourly Rate Calculator, enter that rate and 20 hours – the calculator will show you the take home pay.
2. If you just know the annual salary for 37.5 hours a week, first divide the salary by 37.5, then multiply it by 20. Enter this new salary into the normal calculator and it should give you the right information.

According to HMRC, tax, NI etc are all worked out the same whether you worked 37.5 hours to earn the money, or just 20 (or 1!). The above tricks can show you what you need to know until I have time to create a pro-rata calculator.

Tags: HMRC, income tax, pro-rata, tax rates, The Salary Calculator

6 Comments to Pro-rata calculations

1. 

   Sorry, are you sure your calculations are right?! Your weekly figures seem right but not your monthly ones.

   I work a temporary job for £10.50 per hour for 30 hours a week with no sick pay and holiday pay pro rata. I got a monthly pay slip this week based on 4 weeks, and my gross pay was £1181.25 because I had to drop one day, so for that week I was paid £236.25. They deducted £314.06, £77.66 for NI and £236.40. I walked away with a minty £867.19 which I’m not at all happy with. Was that 20% BR tax?

   But for four weeks at £315 per week, which is correct, I should get £1260 gross – not £1365 as you suggest, surely? So have they overcharged my NI? I’ve queried it with them, quoting the figures I got from your site, but now I’m wondering because your monthly figures seem way off. What else are you taking into consideration there?
Tracey Mitchell on October 3rd, 2009
2. 

   Hi Tracey,

   I think there are two things going on here, firstly a comparison of weekly and monthly, and secondly the tax your employer has taken off you.

   First thing is to note is that a month is not exactly 4 weeks. 4 weeks would be 28 days, not 30 or 31 – so the monthly value is more than 4 times the weekly value. In fact, the calculator divides the annual figures by 12 to give the monthly figures, and by 52 for the weekly figures. So that’s why 4 times £315 is not £1,365

   Secondly, it seems to me that you have been charged too much tax. If you are new to the job, they may have used “emergency tax”, where they don’t know your tax code. Without your tax code, they can’t give you your personal tax-free allowance, so they have taxed all of your income. I’m sure they will clarify this with you – most employers will correct this for your next payslip, and may even refund you the overcharged amount (so next month might be more than you expect!).

   I hope this helps, and as always your employer should be able to explain your payslip to you!
admin on October 3rd, 2009
3. 

   Thank you for the explanation.

   I did challenge them about the tax and they then told me I had to complete a P46, in order for them to obtain a correct tax code for me and get me off BR.

   I had given them a P45 from my previous temp role which had had a BR tax code with it (because I had one and because I thought P45s were preferable over P46s!) but I hadn’t noticed the deduction as much because that role was weekly paid. For the last seven years I have also worked on and off for a nurse ‘bank’ for which I have a proper tax code – I don’t see why I can’t pass that on to this current employer, but apparently each new job needs a new tax code!

   (I’ve only been working nineteen years, like!)

   I know for a fact my name is mud with the inland revenue with all my temp roles because they as much as said they’re fed up with giving me rebates!
Tracey Mitchell on October 14th, 2009
4. 

   Hi, I have a question about tax free allowance. I started my new job in Nov 2010, and thus will only be working 5 months this tax year (1 Nov – 31 Mar). I understand that the current tax free allowance is at £6475. Will I be getting the full £6475 tax free allowance, or will there be some sort of a pro rata calculation (i.e. £6475 x 5/12 = £2698)?
Jin on February 3rd, 2011
5. 

   Hi Jin,

   If you didn’t have any income between April 2010 and starting your new job in November, you should be entitled to your full allowance of £6,475 for the 2010-11 tax year (although the allowance can be affected by other benefits – see the post on tax codes). Most employers will automatically work out the correct amount for you to take home this tax year, and spread that over your payslips. You may find in April that you take home less than you do now, since your tax-free allowance will be spread over the whole year rather than just 5 months! If you are uncertain, check with your employer’s finance or HR department – they will be able to explain things to you. If you have paid too much tax this year you can normally claim it back from your local tax office.
admin on February 5th, 2011
6. 

   hi, while you are developing a tool for reduced hours working, please could you consider developing something for reduced weeks working. I am a term time only worker, working 37 weeks per year and would like help to calculate earnings please. thanks
bobby on March 14th, 2011

Leave a comment