Want to reverse the calculation? Start with the hourly wage and answer the question: 7 dollars an hour is how much a year? You get the same result if you work all year with no vacation time.
In the previous case, we assumed 2 weeks of unpaid vacation, so your total year consisted of 50 weeks. But if you get paid for 2 extra weeks of vacation at your regular hourly rate , or you actually work for those 2 extra weeks, then your total year now consists of 52 weeks.
Assuming 40 hours a week, that equals 2, hours in a year. If you wanted to be even more accurate, you can count the exact number of working days this year. It has a total of days in the year including both weekdays and weekends. There are weekend days counting every Saturday and Sunday in the year , and weekdays Monday through Friday.
So if you worked a normal 8 hour day on every weekday, and didn't work any overtime on the weekends, you would have worked a total of 2, hours over the year. Most companies give employees time off for various holidays, so that should really be included in the calculation. The problem is that different countries can vary in their national holidays, and your company may give certain days off but not others. On average, in the U. Many businesses also have an additional floating holiday that is sometimes used for Christmas Eve, New Years Eve, or one of the days near July 4th.
Often this is based on whether one of those days falls on a Tuesday or Thursday. Adding that extra holiday can give employees an extra long weekend. Neena, 38, works as a cleaner. There is a comprehensive employer guide to calculating the NMW and NLW produced by the BEIS that you may find helpful as it covers other complex topics like salaried workers and sleeping in time.
Although it is aimed at employers, employees may find it useful too when trying to understand the rules and self-check their position. Your employer needs to put right any minimum wage underpayment by paying the arrears they owe you going back up to six years. You can find the telephone number on GOV. Alternatively, you can use an online form to make a complaint directly to HMRC or take your employer to an Employment Tribunal yourself although there are strict time limits for this.
If HMRC decide that the employer has not paid the minimum wage, the employer will be sent a notice telling them that they must pay you the arrears and they may also be given a penalty. The arrears will be repaid to you at current rates for all the periods they were underpaid, even if these are higher than the rate that applied when the arrears arose.
This is in recognition of loss of purchase power you may have suffered from the initial underpayment. Even so, the employer will very probably operate Pay As You Earn PAYE tax at the time they pay the arrears and in a way that means she will have some tax deducted, so she will need to claim a refund. Please note that the rules are a bit different for National Insurance — it is calculated on the basis of the year the payment is made only: it is not related back to prior years.
Finally, you should be aware that such arrears payments may impact any benefits or tax credits you receive, so it is vital that you tell the relevant authorities about any minimum wage arrears as soon as possible even if they then go on to disregard the increase in income for whatever reason. You can find out more on what to do if your employer refuses payment, on GOV. You can get more help by contacting the ACAS helpline for help in the following employment areas:.
The helpline takes calls in over languages. You can also ask a question using their online form, which you can find on the ACAS website. For further help on the minimum wage, we suggest you look at GOV.
Skip to main content. Home Tax Guides Employment What is the national minimum wage? What is the national minimum wage? Updated on 2 August If you are 23 or over, there is also the national living wage NLW , which we explain below. What are the current rates? I have just had a birthday and I am entitled to a higher rate, when should the new rate apply? The accommodation offset rate is amended on 1 April every year. What are some problem areas?
We look at some of them here: Training time Where workers undergo training for example — employment induction or skills development , the time spent on such activities is working time for minimum wage purposes where a contract of employment has started or where it is a contractual requirement for the worker to attend the training.
Example Wali is 35 years old and is paid weekly. Interns Any intern who has a contractual relationship with his employer must be paid at least minimum wage for the hours they have worked. Example Carry aged 19 is paid weekly. Salary sacrifice Under a salary sacrifice arrangement , an employee is able to swap cash salary for non-cash benefits like pension contributions, cycle to work or childcare vouchers closed to new recipients from October Example Neena, 38, works as a cleaner.
Other areas There is a comprehensive employer guide to calculating the NMW and NLW produced by the BEIS that you may find helpful as it covers other complex topics like salaried workers and sleeping in time. Where can I get more help? What income is taxable? What tax allowances am I entitled to? What tax rates apply to me? How is my tax collected? What if I cannot pay my tax bill? Do I need to complete a tax return? Self Assessment: understanding the basics What is Simple Assessment?
How do I claim tax back? How do I claim back tax if I complete a tax return? How do I claim back tax on savings income? How do I claim a marriage allowance refund? How do I claim back tax on a payment protection insurance PPI pay-out?
Should I use a tax refund company? What is National Insurance? How do I get a National Insurance number? What are Adult Specified Childcare credits?
What is Scottish income tax? What is devolution? Do I have to pay Scottish income tax? How does Scottish income tax work? What is Welsh income tax? Do I have to pay Welsh income tax? Do I have to join a pension scheme? What if I have a tax credits overpayment? Working through a limited company What is the national minimum wage?
How do I work out my tax? How is tax collected on taxable state benefits? How do I check my coding notice? What tax do I pay on redundancy payments? Termination payments on leaving the armed forces Employment benefits and expenses What are benefits-in-kind? What payments and benefits are non taxable? What if I incur expenses in relation to my job? What travel expenses can I claim?
What if I use my own car for business purposes? Payroll giving Allowances and expenses paid to armed forces personnel and deductions from their income Pensions and employees What is automatic enrolment for employees? What National Insurance do I pay as an employee?
How do I repay my student loan? What if I do not pay enough tax?
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