Freelance Hourly Rate Calculator
Work out the hourly rate you need to charge to hit your income after expenses.
How to use the Freelance Hourly Rate Calculator
- Enter the annual income you want to take home.
- Add your yearly business expenses.
- Enter your realistic billable hours per week and working weeks per year.
- See the hourly rate — and day rate — you need to charge.
Rate = (Target income + expenses) ÷ (billable hours per week × working weeks)
About the Freelance Hourly Rate Calculator
New freelancers almost always undercharge, because they divide the salary they want by 40 hours a week and 52 weeks a year — hours they will never actually bill. This calculator does it properly. It takes the income you want plus the business expenses you must cover, and divides by the hours you can realistically bill once admin, marketing, holidays and slow weeks are removed. The result is the rate that actually delivers your target, not the one that leaves you working constantly and still short.
The gap is bigger than most expect. If you want the equivalent of a $60,000 salary but can only bill 25 hours a week for 46 weeks, your rate has to be far above $60,000 ÷ 2,080 hours — because you are paid for a fraction of the time you work, and your expenses come out of it too. Seeing the day rate alongside makes it easy to quote fixed-price work as well.
This gives you a floor to price from; your market, experience and the value you deliver can push the rate well above it, but rarely should it go below. To compare against an employed salary use the salary to hourly calculator, and to plan tax on the income the self-employment tax calculator.
Frequently asked questions
Why is my rate higher than salary divided by hours?
Because you cannot bill every working hour. Admin, sales, holidays and gaps between clients are unpaid, and your expenses come out of what you charge, so the billable rate has to be higher to reach the same income.
How many billable hours should I assume?
Be realistic — many freelancers bill 20 to 30 hours in a 40-hour week once non-billable work is counted, and take several weeks off a year. Lower, honest numbers give a rate you can actually sustain.
Does this include tax?
The rate covers your target income and business expenses. Set your target as pre-tax income and handle tax separately, since self-employment and income tax depend on where you live.