About this tool
Why it exists.
New freelancers often copy a salary into an hourly rate and end up underpaid. A salary covers paid holidays, equipment, software, insurance, tax and the hours spent on admin and finding clients. A freelance rate has to cover all of that from the hours you can actually invoice.
Enter the take-home income you want, your yearly business expenses, an estimated tax rate, the billable hours you can realistically work each week, and the weeks you will work. The calculator grosses up your income for tax, adds expenses and divides by your billable hours to give the hourly rate, a day rate and the yearly invoicing you need.
How to use it.
- Enter the yearly take-home income you want and your business expenses.
- Add an estimated tax rate, billable hours per week and working weeks per year.
- Read the hourly rate, day rate and yearly invoicing target.
Good questions.
Why are billable hours lower than working hours?
Time spent on emails, quotes, invoices, learning and finding clients is rarely paid. Many freelancers bill about 50–70% of their working week, so 20–28 billable hours is common for full-time work.
What tax rate should I enter?
Use a rough effective rate on your profit, including income tax and social contributions where they apply. It is only an estimate, so ask an accountant for a figure that fits your situation.
Should I charge exactly the calculated rate?
Treat it as a minimum. Consider market rates, your experience and the value you deliver, and add a buffer for late payments and quiet months.