$80,000 income, $10,000 costs, 25% tax, 25 hours a week, 6 weeks off
$101 an hour or $812 a day.
Freelance rate calculator
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Tax is a flat share of profit (income after business expenses). Billable hours are the hours you can charge to clients, not the hours you work. Health insurance and retirement savings belong in expenses or in your target income.
80 thousand
10 thousandSoftware, equipment, insurance, accounting, co-working.
%
Holidays, sick days and slow weeks.
Hourly rate to charge
$101
You need $116,667 in sales over 1,150 billable hours. A full 8-hour day is $812.
- Day rate (8 hours)
- $812
- Weekly sales needed
- $2,536
- Yearly sales needed
- $116,667
- Billable hours a year
- 1,150
Hourly rate at other billable hours
| Billable hours a week | Hourly rate | Day rate |
|---|---|---|
| 15 | $169.08 | $1,353 |
| 20 | $126.81 | $1,014 |
| 25 | $101.45 | $812 |
| 30 | $84.54 | $676 |
| 35 | $72.46 | $580 |
| 40 | $63.41 | $507 |
Setting a rate that actually pays you
Freelancers who divide their old salary by 2,080 hours usually undercharge. A salary comes with paid holidays, employer taxes, equipment and a steady flow of work. As a freelancer you pay all of that yourself, and some weeks you will not bill a single hour.
Start from the end. Say you want to keep $80,000 a year, expect tax of about 25% of profit, and have $10,000 of business costs. You need $106,667 of profit and $116,667 of sales. If you bill 25 hours a week and take 6 weeks off, that is 1,150 billable hours, so the rate is $101.45 an hour, or about $812 for an 8-hour day.
Billable hours move the answer most. At 30 billable hours a week the same income needs $84.54 an hour. At 15 hours, while you are building a client list, it needs $169.08. Be honest about how much time goes on admin, sales and learning.
Treat the result as a floor, not a target. Market rates in your field and the value of the work to the client matter too. If the floor is above what clients will pay, the fix is usually more billable hours, lower costs or a higher-value niche.
Sources
What this calculator does not account for
- Tax is a single flat share of profit.
- Treat the result as a floor; market rates matter too.
How this is calculated
Formula: Freelance rate
hourly rate =(income ÷ (1 − tax rate) + expenses) ÷ (billable hours a week × working weeks)What the symbols mean
- incomeWhat you want to keep after tax.
- tax rateYour expected tax as a share of profit.
- expensesBusiness costs for the year.
- working weeks52 minus weeks off for holidays, illness and gaps between projects.
Good to know
- Billable hours are usually well below hours worked, because admin, sales and learning are not paid.
- A day rate here is 8 billable hours.
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Worked examples
Each example is worked out by the same code as the calculator above.
Same, at 30 billable hours a week
$84.54 an hour.
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<iframe src="/embed/freelance-rate-calculator" title="Freelance rate" width="100%" height="720" style="border:0;max-width:42rem" loading="lazy"></iframe>Questions
How do I work out my freelance hourly rate?
Add your target income before tax to your business costs, then divide by the hours you can actually bill in a year.
How many billable hours should I plan for?
Most freelancers bill 20 to 30 hours a week once admin, sales and gaps are counted, not 40.
Why is my freelance rate so much higher than my old salary per hour?
You pay your own tax, equipment, insurance and holidays, and you are not paid for every hour you work.
How many weeks off should I assume?
At least 4 to 8 weeks for holidays, sick days, public holidays and slow periods.
Should I charge by the hour or by the project?
Use the hourly rate to price a project: estimate the hours, multiply, then add a margin for risk.