Salary Calculator

What are other common income terminologies?

Net annual income

Your net annual income is your income after any tax deductions or CPF. This is the income you have for any living expenses for utilities, food and lifestyle spending or savings. Finding out your net annual income is important as it helps you figure out how much you can spend for yourself within your budget.

Household income

Your household income is the total gross income of everyone in a household. This is the amount of money earned by anyone who is of working age, usually 17 years old and above. People in the household may not be related to each other, as long as they all live in the same residential home. Knowing your household income is important as it helps you indicate the standard of living your household can afford in your area. Banks usually assess how much they’re willing to lend you based on your household income.

Business gross income

A company’s gross income, also known as a profit margin, is a measure of an organisation’s profitability. It usually shows the organisation’s gross margin or revenue for the entire year. The company’s gross income includes the direct cost of providing or producing any goods or services, but it doesn’t include other costs, such as selling activities, administration, taxes and any additional fees related to running the business. This is because they’re not directly related to producing or selling the services or products.

Why is calculating an annual income important?

Finding your annual income is important because it shows your financial health. Your annual income is important because it impacts your standard of living and the financial decisions that you make in your life. When you calculate your annual income, you can create a budget for yourself and better understand what you want to spend your money on.

When you’re getting a loan or credit card, companies or lenders usually look at your annual income as well to determine if you’re eligible for a loan and how much they might loan to you. Knowing your annual income can save you time and stress to be eligible for bigger loans and better interests rates. Your annual income also determines the amount of taxes you pay every year. Being able to calculate your annual income can help you better understand the amount of taxes you’re filing for each year and make sure that you’re paying the right amount each year.

Salary

A salary is normally paid on a regular basis, and the amount normally does not fluctuate based on the quality or quantity of work performed. An employee’s salary is commonly defined as an annual figure in an employment contract that is signed upon hiring. Salary can sometimes be accompanied by additional compensation such as goods or services.

There are several technical differences between the terms “wage” and “salary.” For starters, while the word “salary” is best associated with employee compensation on an annual basis, the word “wage” is best associated with employee compensation based on the number of hours worked multiplied by an hourly rate of pay. Also, wage-earners tend to be non-exempt, which means they are subject to overtime wage regulations set by the government to protect workers. In the U.S., these regulations are part of the Fair Labor Standards Act (FLSA). Non-exempt employees often receive 1.5 times their pay for any hours they work after surpassing 40 hours a week, also known as overtime pay, and sometimes double (and less commonly triple) their pay if they work on holidays. Salaried employees generally do not receive such benefits; if they work over 40 hours a week or on holiday, they will not be directly financially compensated for doing so. Generally speaking, wage-earners tend to earn less than salaried employees. For instance, a barista that works in a cafe may earn a “wage,” while a professional that works in an office setting may earn a “salary.” As a result, salaried positions often have a higher perceived status in society.

Most salaries and wages are paid periodically, typically monthly, semi-monthly, bi-weekly, weekly, etc. Although it is called a Salary Calculator, wage-earners may still use the calculator to convert amounts.

After-Tax Income

The after-tax income indicates the total disposable income available to spend after all relevant taxes have been deducted. Individuals and companies’ after-tax income is calculated after all taxes, including federal and withholding taxes, have been removed. However, local taxes, like property taxes and sales, might also be included.

While the formula for calculating after-tax income appears straightforward, it can deduct several sorts of taxes. Federal, provincial, and state taxes are often subtracted. Withholding taxes withheld from an individual’s salary are deducted from after-tax income estimates and paid directly to the government.

These jurisdictions also allow tax credits and government-funded tax breaks to promote certain behaviors, like small-business investment. Tax credits would lower the amount of taxes deducted and raise after-tax income if available.

How to Calculate After-Tax Income?

The Formula for After-Tax Income

For example, assume that a person earns $50,000 per year and is taxed at 12%. As a result, this person’s after-tax income would be $44,000. It would cost $6,000 per year in taxes.

After calculating net income, the firm will subtract all relevant taxes to determine after-tax income. In general, businesses prefer to show increased after-tax profits as an indication of success.

Net Income After Taxes (NIAT)

After-tax income is comparable to (NIAT), except it pertains to corporations rather than individuals. The net income after taxes, also known as profit or net earnings, is the amount of money left after all costs have been deducted.

After taxes, the net income is an essential metric in corporate finance since it indicates the residual profit for owners. A greater NIAT usually means a better share price for publicly listed corporations.

Example – Assume that a person in San Francisco earns $75,000 per year. The individual must pay 14.13 percent federal income taxes and 5.43 percent state income taxes.

What is Earnings Before Tax (EBT)?

On a company’s income statement, EBT is a line item. It depicts a company’s profitability after deducting the cost of goods sold (COGS), interest, expenditures, and other operational expenses. The calculation is revenue minus costs without taxes.

Understanding EBT

Before subtracting tax charges, a company’s EBT is the money it keeps internally. It’s a metric for calculating a company’s operational and non-operating earnings. EBT is calculated in the same way by all organizations.

EBT is estimated by analysts and accountants using that specific financial statement. It only takes information from the income statement. As the top-line figure, a company’s revenue will be recorded first.

If a corporation sells 30 widgets for 800,000 each in January, its monthly revenue is $30,000. The corporation calculates its COGs and deducts that amount from the $30,000 income.

After calculating gross revenue, a corporation adds up all its operational expenditures and subtracts that amount from the gross income. A company’s running costs might include expenses linked to its day-to-day operations, such as salaries and wages, rent, and other overhead expenses.

Suppose the company is a technological firm with significant human capital expenditures. In that case, wages of $10,000 per month and 800,000 per month rent are possible. Because of the higher production costs would have to deduct $11,000 in total overhead from its gross sales.

If the firm has no physical assets and instead rents computers and server space from Amazon, the company’s profits before interest and taxes (EBIT) would be $16,000. Its EBT would be $15,000 if it had 800,000 in monthly interest charges.

Source:

https://sg.indeed.com/career-advice/pay-salary/what-is-annual-income
https://www.calculator.net/salary-calculator.html
https://rigorousthemes.com/blog/annual-income-what-does-it-mean-how-to-calculate-your-income/
Salary Calculator

Hourly to Salary – Wage Calculator

Natural leader who can motivate, encourage and advise people, she is an innovative and creative person. She loves to generate fresh concepts and make goods. She generally adopts a creative approach to issue resolution and she continuously tries to accomplish things using her own thinking.

The hourly to salary or hourly rate calculator can assist you in determining what that wage is. Do you want to know what your yearly income is? Trying to compare different jobs? How do I compute an employee’s hourly rate based on annual salary? Simply input your hourly rate and the amount of hours you want to work each week. You may also calculate an employee’s hourly compensation by dividing their yearly salary by the amount of hours worked in a year.

A full-time employee works 2,080 hours a year based on a standard work week of 40 hours (40 hours a week x 52 weeks a year). So, if a person makes $40,000 per year working 40 hours per week, their hourly wage is around $19.23. (40,000 divided by 2,080).

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Hourly to salary – types of wages

Types of wages are:

  • Salary. Salaries are fixed sums of money that companies pay to their workers on a yearly basis. They generally distribute payments throughout the course of the year to equal the annual amount agreed to in employment contracts.
  • Hourly pay. They are a form of compensation in which employees are paid by the hour. This is a popular form of remuneration for part-time and sometimes full-time work.
  • Commissions. Commissions are generally given to salespeople by their employers. In addition to hourly or salary income, employers provide commission.
  • Fair wage. By “fair wage,” we mean an amount that businesses can afford to pay their workers. It considers things like the cost of living in a specific location and the usual salary for a given job.
  • Overtime. Overtime pay is given to employees who work more than 40 hours each week. When an employee works more than 40 hours in a week, their overtime compensation is generally twice that amount.
  • Severance pay. Payment made in the event of a job loss. Severance pay is a form of salary paid by employers to employees who must be let go.
  • Prevailing wage. A prevailing wage is a form of wage utilized in government contracts between government agencies and outside firms.
  • Living wage. Living wage differs from minimum wage in that companies are not required to follow legal rules as they would if they provided employees minimum pay.
  • The minimum salary. Minimum wage refers to a fixed hourly amount imposed by the US Department of Labor.
  • Bonuses. Bonuses are monetary rewards given to employees by their employers in exchange for doing an outstanding job.
  • Paid time off (PTO). PTO is a type of accumulated compensation that allows employees to earn paid time off for each day, week, or another time period in which they work.

Salary

A salary is normally paid on a regular basis, and the amount normally does not fluctuate based on the quality or quantity of work performed. An employee’s salary is commonly defined as an annual figure in an employment contract that is signed upon hiring. Salary can sometimes be accompanied by additional compensation such as goods or services.

There are several technical differences between the terms “wage” and “salary.” For starters, while the word “salary” is best associated with employee compensation on an annual basis, the word “wage” is best associated with employee compensation based on the number of hours worked multiplied by an hourly rate of pay. Also, wage-earners tend to be non-exempt, which means they are subject to overtime wage regulations set by the government to protect workers. In the U.S., these regulations are part of the Fair Labor Standards Act (FLSA). Non-exempt employees often receive 1.5 times their pay for any hours they work after surpassing 40 hours a week, also known as overtime pay, and sometimes double (and less commonly triple) their pay if they work on holidays. Salaried employees generally do not receive such benefits; if they work over 40 hours a week or on holiday, they will not be directly financially compensated for doing so. Generally speaking, wage-earners tend to earn less than salaried employees. For instance, a barista that works in a cafe may earn a “wage,” while a professional that works in an office setting may earn a “salary.” As a result, salaried positions often have a higher perceived status in society.

Most salaries and wages are paid periodically, typically monthly, semi-monthly, bi-weekly, weekly, etc. Although it is called a Salary Calculator, wage-earners may still use the calculator to convert amounts.

Other methods of remuneration

Earning an hourly rate or receiving an annual salary are common forms of compensation; however, there are a variety of ways that individuals can be paid for work. Alternative methods of payment include:

Piece work:

Sometimes referred to as piece based pay, piece work entails being paid a set rate per task or piece of work completed. Piece work is common in manual labour roles, such as agriculture work where employees are paid a set rate for each container full of crop they pick.

Commission

Being paid a commission means employees receive a percentage of the revenue they produce for the company from a particular service, deal or client. This method of payment is popular in skilled trades such as hairstyling, as well as being common in recruitment agencies. An example of commission-based pay would be a barber receiving 50% of the money they make from each haircut. The other 50% is paid to the owner of the shop they cut hair in.

Resource:

https://calconcalculator.com/finance/hourly-to-salary-wage-calculator/
https://www.calculator.net/salary-calculator.html
https://uk.indeed.com/career-advice/pay-salary/hourly-rate

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