1. Employment Income:
• For salaried individuals, annual income is often equal to the gross salary multiplied by the number of pay periods in a year. If the salary is expressed monthly, multiply it by 12.
• For those with variable income, such as hourly or freelance workers, calculate the average monthly income and then multiply it by 12.
2. Business Income:
• For individuals running a business, annual income is determined by calculating the total revenue generated by the business throughout the year. This includes sales, fees, or any other income generated by the business activities.
3. Investment Income:
• Investment income includes earnings from investments such as interest, dividends, and capital gains. To calculate annual income from investments, add up all income received from these sources over the year.
4. Rental Income:
• If an individual earns income from renting out properties, the annual income is the total rent received from tenants over the course of the year.
5. Other Sources:
• Other sources of income may include royalties, alimony, bonuses, or any other form of financial gain. Calculate the total income from each source.
After determining the income from each source, add them together to arrive at the total annual income.
