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Freelance Hourly Rate Calculator

Find the minimum rate you need to charge as a freelancer or consultant. Enter the income you want, your business costs, taxes and how many hours you can really bill, and get an hourly rate, day rate and revenue target.

Currency

Income goal

Desired yearly income

That income is

Before tax (like a salary)After tax (take-home)

Yearly business expenses

Software, equipment, insurance, health cover, office, fees

Tax rate on profit

Income + self-employment tax, your estimate

Time

Billable hours per week

Hours you can invoice, not total hours worked

Vacation weeks per year

weeks

Holidays and sick days

days

Billable hours in a day rate

Profit / savings buffer

Extra margin for slow months and growth

Enter your values to see the result.

How to use the Freelance Hourly Rate Calculator

Enter your income goal and say whether it is before or after tax.
Add yearly business expenses and your estimated tax rate on profit.
Enter billable hours per week: only the time you can invoice, not admin or sales time.
Enter vacation weeks and holidays/sick days so the rate covers time off.
Press Calculate my rate to see your minimum hourly and day rate and how it changes with more or fewer billable hours.

Freelance rate formula

Pre-tax profit needed = take-home income ÷ (1 − tax rate) (or your before-tax income goal)
Revenue needed = (profit + business expenses) × (1 + buffer %)
Working weeks = 52 − vacation weeks − holiday and sick days ÷ 5
Billable hours per year = billable hours per week × working weeks
Hourly rate = revenue needed ÷ billable hours per year
Day rate = hourly rate × billable hours per day

Example: $70,000 before tax + $8,000 expenses = $78,000, plus a 10% buffer = $85,800. With 4 weeks of vacation and 10 holiday days there are 46 working weeks; at 25 billable hours that is 1,150 hours. Rate = $85,800 ÷ 1,150 = $74.61 per hour, or $596.87 for an 8-hour day.

Revenue needed of $85,800: rate by billable hours

Billable hours per week	Billable hours per year (46 weeks)	Hourly rate
15	690	$124.35
20	920	$93.26
25	1,150	$74.61
30	1,380	$62.17
35	1,610	$53.29
40	1,840	$46.63

Small changes in billable hours move your rate a lot, which is why an honest estimate of invoiceable time matters more than any other input.

Frequently asked questions

How do I calculate my freelance hourly rate?

Add the income you want to the business expenses you must cover, add any profit buffer, then divide by the hours you can bill in a year. Billable hours = billable hours per week × working weeks after vacation, holidays and sick days.

Why is my freelance rate so much higher than my old salary per hour?

As an employee you are paid for about 2,080 hours a year including holidays, and your employer covers equipment, payroll taxes and benefits. Freelancers pay those costs themselves and usually bill only 50% to 75% of the hours they work.

How many billable hours per week is realistic?

Many full-time freelancers bill 20 to 30 hours a week. The rest goes to finding clients, email, invoicing, learning and unpaid revisions. Plan with a realistic number rather than 40.

What tax rate should I use?

Use your estimated combined rate on profit. In the US that includes income tax plus self-employment tax of 15.3% on most net earnings, so totals of 25% to 35% are common. Check with a tax professional for your situation.

Should I charge an hourly rate or a day rate?

Both are common. A day rate is simply your hourly rate times the billable hours in a day, often 6 to 8. Many freelancers also move to project pricing once they know how long typical jobs take.

Is this the rate I should charge?

It is your minimum to meet your goals. Market rates for your skills, experience and niche may be higher, and you should charge more where clients value the result more.

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