Overtime Calculator

About the Overtime Calculator

Time and a half is not half again in your hand.

Overtime is paid on top of your normal earnings, which means it sits at the top of your income — and the top of your income is taxed at your marginal rate, not the average you are used to seeing on a payslip.

So this overtime calculator reports the gross figure and the net one side by side, and then answers the question that actually makes overtime decisions hard: do all the hours pay the same?

Often they do not.

How to Use the Overtime Calculator

Enter your normal hourly rate, the overtime hours and the multiplier — normal rate, time and a third, time and a half, or double time.

Marginal rate is the tax and contributions on your next pound. This is the number people get wrong: it is not the average on your payslip.

Base annual pay, next tax band and rate above it are optional. Fill them in and the calculator finds the point where your overtime stops being worth what the earlier hours were.

Step-by-Step Example

£22 an hour, 8 hours of overtime a week at time and a half, 48 weeks, 28% marginal rate.

  Gross rate:      22.00 × 1.5      =  33.00 an hour
  After 28% tax:                       23.76 an hour

  Per week:        264.00 gross, 190.08 net
  Per year:                            9,123.84 net

Does the Multiplier Survive Tax?

Yes — and this is worth being precise about, because it is easy to get wrong in either direction.

A normal hour at £22 nets £15.84 after 28%. An overtime hour at £33 nets £23.76. That is still exactly 50% more. The multiplier survives tax intact, because both hours are taxed the same way.

What changes is the base it is applied to. If you are picturing "time and a half" against your gross normal rate and then comparing it to your net spending money, the overtime hour will feel smaller than expected — not because the uplift shrank, but because you were comparing two different things.

The real problem is not the multiplier. It is that people quote themselves their effective rate when the marginal rate is what applies.

Not All the Hours Pay the Same

This is the finding worth having, and no payslip shows it.

£46,000 of base pay, £50,270 threshold, 42% above it:

  Headroom before the band:         4,270.00
  Overtime for the year:            9,123.84

  First 4,270 taxed at 28%:   →  23.76 an hour
  The rest taxed at 42%:      →  19.14 an hour

The hours after roughly 129 are worth £4.62 an hour less than the ones before.

The average across the year hides this completely. If you are deciding how much overtime to take — rather than whether to take any — the rate on the last hours is the number that should decide it, not the blended figure.

Someone happily working 129 hours of overtime at £23.76 might feel quite differently about hours 130 to 276 at £19.14.

Where There Is Room

The calculator also reports the other case:

  30,000 base + 2,640 overtime = 32,640 total
  Threshold at 50,270

  Another 17,630 of overtime would still be taxed at 28%.

Which is a useful thing to know before agreeing to a lot more — there is headroom, and the rate does not change until it is used up.

What This Cannot Tell You

Whether the hours are worth it.

The calculator reports what an hour pays after tax. What an hour of your life is worth is not a number it has, and for most people it is the larger half of the decision.

What it can do is make the trade honest. "£19.14 an hour, after the threshold, on a Saturday" is a different proposition from "time and a half", and the second phrasing is the one that gets offered.

Two other things it does not model, both of which can matter:

Pension treatment. Some schemes contribute on overtime and some only on base pay. If yours excludes overtime, the hours are worth less than they look relative to a pay rise.

Means-tested support. Where benefits or childcare support taper with earnings, the effective marginal rate on overtime can be far above the tax rate alone — sometimes dramatically so.

Understanding Your Result

In your hand is the net hourly rate — the figure to make decisions on.

Gross against net shows both, with the multiplier and the tax named.

Weekly and yearly gives the totals either side of tax.

Where the rate changes identifies the crossing point, or confirms there is room below the band.

Worth knowing says which hours are worth what, or how much headroom remains.

When Should You Use This Calculator?

Before agreeing to regular overtime. Especially near a band threshold.

When comparing overtime to a second job. The marginal rate applies to both, so the comparison is about the rate rather than the tax.

When offered double time. To see what it actually nets.

When choosing how many hours to take. The rate on the last hours is the one that should decide.

Common Mistakes

Using your payslip's effective rate. Overtime is taxed at the marginal rate.

Assuming all overtime hours pay the same. They do not if you cross a band.

Thinking tax eats the multiplier. It does not — the uplift survives intact.

Forgetting the threshold is annual. A heavy month does not cross it; a heavy year does.

Ignoring pension treatment. If overtime is excluded from pensionable pay, an hour of overtime is worth less than an equivalent rise.

Comparing gross overtime to net spending. Compare net to net, or the figure will always disappoint.

Rates and thresholds vary by country and change regularly. Every figure here is an estimate for planning, not tax advice.