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Freelance Rate Calculator

The hourly rate below which the work costs you money — calculated from what you need to take home, not from what feels reasonable.

✓ Updates as you type✓ Works on mobile✓ Your numbers stay on your device

Your numbers

Take-home pay is what you want left after tax and business costs.

Take-home pay you need/yrBusiness costs/yr

Effective tax rate%Billable hours/yr

The maths

How this is worked out

Tax applies to profit, not to revenue, so the calculator grosses up your target take-home pay first, then adds business costs on top, then divides by the hours you can bill. Doing it in the other order — taxing your expenses as if they were income — inflates the rate and is the most common mistake in DIY rate spreadsheets.

Rate floor = [ take-home ÷ (1 − tax rate) + business costs ] ÷ billable hours

Worked example

A worked example

To take home $60,000 at an effective 25% tax rate, you need $80,000 of profit. Add $6,000 of business costs and you need $86,000 of revenue. Spread over 1,000 billable hours, that is a floor of $86 an hour.

Replace the figures above with your own — the result updates as you type.

Read this before you quote

What the number does and does not cover

This is a floor, not a price. It is the point where the work breaks even against the life you are funding. What you actually charge should sit above it, and how far above is a matter of positioning and demand, not arithmetic.
The number is only as honest as the billable hours you feed it. If you entered 2,080, you have assumed every working hour is paid — run the billable hours calculator and use the real figure instead.
Effective tax rate is not your top bracket. It is total tax divided by total profit, and for most self-employed people it also has to include self-employment or national insurance contributions. Last year's tax return is the best source.
Business costs means costs the business carries: software, insurance, hardware, accountancy, co-working, professional subscriptions. Rent and groceries belong in take-home pay, not here.
Coming from a salaried job? The salary to freelance rate calculator starts from what you used to earn instead.

Questions

Freelance Rate Calculator: questions freelancers ask

Why is my rate floor so much higher than my old salary rate?

Because a salary hides costs your employer was paying: payroll tax, paid holiday, sick leave, pension, equipment, and the hours you spent in meetings rather than on billable work. The floor makes all of it visible at once, which is uncomfortable but accurate.

Should I add profit on top of this?

Yes, if you want the business to be more than a job. The floor covers your pay and costs; anything above it funds slow months, equipment, time off, and growth. Treat the floor as the line you never quote under, not the number you quote.

What if the rate it gives me is unsellable in my market?

Then one of the four inputs has to move, and only two are really under your control: your billable hours and your costs. Charging under your floor is the one option that cannot be sustained, so it is worth checking the billable hours figure before concluding the market is wrong.

Does this work for project pricing?

It gives you the hourly floor to price against. Estimate the hours a project will really take, add a buffer for revisions, multiply by a rate at or above the floor, and quote that as a fixed price.

Next step

Keep working the numbers

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