Freelance Rate Calculator

Most freelancers set a rate by looking at what other people charge, then wonder why the year does not add up. The reliable method runs the other way: start from the money you want to keep and work backwards through everything that takes a share of it.

Two things are consistently underestimated. The first is that tax comes out of gross, so you have to gross up rather than mark up — at a 30% rate, keeping 60,000 means invoicing 85,700, not 78,000. The second is billable hours. Nobody bills forty hours a week. Pitching, invoicing, admin, email, bookkeeping and the hours between contracts are all real and none of them are chargeable, which is why 25 billable hours is a realistic full-time week.

Together those two things explain almost the entire gap between a freelance rate and a salary. A 60 an hour rate sounds like 124,000 a year at forty hours. Billed at 25 hours over 46 working weeks it is 69,000 gross, which after tax and costs is not a large income at all.

1. Step 1 Working weeks weeks = 52 − weeks_off Holiday, illness and the gaps between contracts all count.
2. Step 2 Billable hours a year hours = billable_hours_per_week × working_weeks
3. Step 3 Gross you need to invoice gross = (take_home + business_costs) ÷ (1 − tax_rate) Divide, not multiply — tax comes out of the top.
4. Step 4 Base rate base = gross ÷ billable_hours
5. Step 5 Add margin rate = base × (1 + margin%) Headroom for slow quarters, reinvestment and the risk you carry.
6. Step 6 Day and week rates day = rate × 8 week = rate × billable_hours_per_week

Example: 60,000 take-home, 6,000 of costs, 30% tax, 25 billable hours over 46 weeks, 15% margin. Gross needed is 94,286 over 1,150 hours, which is 82 an hour before margin and 94 after — a day rate of 754.

• The tax rate you enter is an effective rate across all of your income and contributions, not a marginal bracket. Real tax depends on your country, your business structure, deductible expenses and any other income — an accountant will give you a number that is worth far more than this estimate.
• Business costs are annual and should include everything: software subscriptions, hardware amortisation, insurance, accountancy, workspace, phone and internet, training, professional memberships and travel. Most people underestimate this by half.
• Billable hours are hours a client pays for. The default of 25 per week reflects that admin, sales, proposals, invoicing and email consume a large share of any freelance week. Very few people sustain more than 30.
• Weeks off should include holiday, sickness and the gaps between contracts. Six is optimistic — employees receive that in paid holiday alone before any sick leave.
• Margin is applied on top of the covered costs. It is not profit in an accounting sense; it is headroom for slow quarters, equipment replacement and the risk that a client does not pay.
• Nothing here accounts for pension or retirement saving, health insurance where an employer would normally provide it, or paid parental leave. If those matter to you, add them to business costs or to the take-home target.
• The salary equivalent shown compares gross figures only. It does not price in employer pension contributions, paid leave, sick pay, equipment or job security, all of which make an employed role worth more than the same headline number.
• The result is a floor for pricing, not a market price. What you can charge depends on the value of the work, your specialism and your positioning.