Annual Leave Calculator and Explainer for UK Businesses

Use our annual leave calculator to work out how much leave your employees are entitled to, and learn more about holiday carry over and pay.

We all love a holiday, don't we? Whether it be to a fancy seaside resort, a relaxing city break or a staycation, there's nothing better than being able to turn work mode off and take some well-earned rest.

But for UK business owners, thinking about holidays also involves calculating annual leave for employees. When there’s a constant barrage of questions from sun-starved employees, this can get a little tricky, particularly around the topic of holiday carryover. 

Thankfully though, help is at hand with this guide, and our annual leave calculator for UK businesses.

In this short piece, we run through how to calculate annual leave entitlement and explain everything you need to know about employee holiday rights in the UK.

UK annual leave entitlement explained

Before we look at any annual leave calculations, let’s review how holiday entitlement works. 

How much holiday you receive is normally set out in your employment contract.

Most UK workers with fixed-hour contracts are entitled to a minimum of 5.6 weeks' annual leave per year, capped at 28 days paid unless a company offers an additional amount. It is important to note that bank and public holidays CAN be included in the 5.6 weeks.

UK workers on non-fixed or irregular hours are entitled to a percentage of annual leave for every hour they work, and there’s a specific way of working out holiday pay for zero hour contracts.

How to calculate annual leave entitlement in the UK

You can use our simple annual leave calculator below to determine the amount of entitlement an employee would get for the number of days they work.  

You can use it as both full-time and part-time annual leave calculator

For a basic annual leave calculation for a UK allowance, you simply multiply the number of days you work on average each week by 5.6.

For example, if someone you employ works a five day week, they would be entitled to 28 days' annual leave a year.

5 days x 5.6 weeks = 28 days

How to calculate annual leave for part-time workers

If you're dealing with a part-time worker in the UK, the same calculation applies.

This means that regardless of how many days worked, they would will still be entitled to 5.6 weeks, multiplied by the number of days you work per week.

For example, if you work just three days a week, you would multiply this number by 5.6.

3 days x 5.6 weeks = 16.8 days

How to work out annual leave for casual workers and zero-hour contracts

If a staff member doesn’t have a set number of working hours each week, your annual leave calculation will be done slightly differently.

Here you have two options - workers can either acquire a percentage of annual leave against their hours work or accrue holiday pay instead. 

For example, if you can potentially work 52 weeks of the year, you would accrue 12.07% annual leave for every hour you work.

The calculation for this method is as follows:

When should annual leave be paid in the UK?

Workers should be paid for annual leave when they either:

• Take their annual leave - in other words, they go on holiday 

• When they leave your employment, or;

• If they’re an irregular worker and are paid through rolled up holiday pay

How much annual leave can a UK employee carry over?

What does the law say?

Employees must take all four weeks of EU statutory leave  during their leave year. If they don't, these will be lost. The 1.6 weeks (or eight days if you work full-time) that the UK adds to this statutory leave may be carried over if agreed with an employer. However, it’s not an automatic right. 

Exceptions to the law

There are exceptions to this law. 

If your employee has holiday carry over due to being on maternity, paternity or adoption leave, they can carry the entire amount over.

However, if the carry over is due to sickness, they can carry up to 20 days over.

As an employer, you can decide to offer more than the statutory leave, and, in this case, more leave can be carried over. This should be stated on all your employment contracts and accompanying employee handbooks.

I have a small business, should I allow annual leave carry over?

If you're a business owner, you will need to decide whether you want to allow unused holiday days to be carried over.

Many employers worry about the costs associated with allowing carry over and the impact that it will have on the business.

It's important to remember that statutory holiday entitlement is there for a reason and employees should be encouraged to take time off.

With an estimated 40% of UK employees using their full holiday entitlement, it may be a nice option to offer your employees; however, the choice is obviously up to you.

PayFit - your new employee annual leave calculator 

If manually calculating annual leave and responding to holiday leave and pay queries is getting tiresome then you might want to consider automated this process.

PayFit’s payroll software can do the heavy lifting, but we’re so much more than just a simple payroll solution. Not only does PayFit automatically calculate holiday entitlement for all regular workers, we also act as a holiday management solution for UK businesses. Employees can request leave through their employee portals, which managers then approve and keep tabs on upcoming holiday dates using our holiday and remote working calendar. Plus, when leave is taken, payslips update in real-time. 

Find out why so many small businesses are switching to PayFit by signing up for a one-on-one demo with one of our friendly product specialists.