Stop undercharging. This free freelance rate calculator works backward from your target take-home income — adding expenses and taxes over your real billable hours — to the hourly rate you should charge.
Results update automatically as you type. Bill only a portion of your week — admin and sales aren’t billable.
How the Freelance Rate Calculator Works
Setting an hourly rate isn't guesswork — it's a math problem that starts with what you need to take home and works backward through taxes, expenses and the hours you can actually bill. The freelance rate calculator turns your target income into a defensible hourly number.
Formula: Hourly Rate = (Target Take-Home Income ÷ (1 − Tax Set-Aside Rate) + Business Expenses) ÷ (Billable Hours per Week × Working Weeks per Year). The calculator first grosses up your take-home target to a pre-tax profit figure, adds your business expenses to get required revenue, then divides that revenue by your total billable hours for the year.
- Target take-home income — the after-tax, after-expense income you want to end the year with
- Business expenses — software, equipment, insurance and other costs of running your freelance business for the year
- Billable hours per week — hours you can actually invoice a client for, not total hours worked
- Working weeks per year — total weeks you plan to work, after subtracting vacation, sick time and slow periods
- Tax set-aside (optional) — the percentage of pre-tax profit you expect to owe in tax, used to gross up your target income
Example Scenarios
| Target Income | Expenses | Hours/Week | Weeks/Year | Tax Set-Aside | Hourly Rate |
|---|---|---|---|---|---|
| $50,000 | $5,000 | 20 | 50 | 0% | $55 |
| $60,000 | $0 | 30 | 50 | 20% | $50 |
| $45,000 | $5,000 | 20 | 40 | 10% | $69 |
| $80,000 | $10,000 | 25 | 46 | 25% | $101 |
| $100,000 | $15,000 | 20 | 44 | 30% | $179 |
Estimating Billable Hours for the Freelance Rate Calculator
Billable hours are the input people most often get wrong in a freelance rate calculator, and they have the biggest effect on the result.
- Start from 52 weeks and take off holidays, public holidays and a realistic allowance for sick days.
- Subtract admin time. Invoicing, sales calls, proposals and learning new tools are real work, but no client pays for them directly.
- Allow for gaps between projects, especially in your first year.
Once these are counted, billable time is often well below a full working week. Enter an honest figure in the freelance rate calculator; an optimistic one quietly lowers the rate it suggests.
With an hourly figure in hand, sanity-check it against what clients in your field pay. If the freelance rate calculator result sits far above the market, look at trimming expenses or adjusting your income target. For a day rate, multiply by the hours you really bill in a typical day.
Rerun the freelance rate calculator each year as costs and taxes change. The freelancer article on Wikipedia covers how independent work is structured, useful background for your freelance rate calculator inputs.
Freelance Rate Calculator FAQ
How many hours per week should I count as billable?
Only count hours you can actually invoice to a client. Time spent on admin, proposals, marketing, invoicing and finding clients isn't billable, so most freelancers can realistically bill somewhere between half and two-thirds of a working week, not the full 40 hours.What should I include in business expenses?
Include recurring costs of running your freelance business: software subscriptions, equipment, a portion of home office costs, insurance, professional fees and marketing. These are separate from personal living expenses, which are covered by your take-home income target instead.What percentage should I set aside for taxes?
This depends on your country, income level and business structure, so the calculator lets you enter your own rate. Many freelancers set aside somewhere between a quarter and a third of profit, then adjust based on guidance from a tax professional or their actual filings.Why is my required revenue higher than my target income?
Required revenue covers three things your take-home income doesn't: it grosses up for tax, then adds your business expenses on top. Revenue is what you need to invoice; take-home income is what's left after tax and costs are paid.How do I use the day rate figure?
The day rate is simply your hourly rate multiplied by 8, useful for quoting clients who prefer to book you by the day rather than by the hour, such as for on-site consulting or workshops.Should I charge exactly the rate this calculator shows?
Treat the result as a floor, not a ceiling. It tells you the minimum rate needed to hit your income goal — market demand, your experience level and what clients in your niche typically pay may justify charging more.Related Calculators
Once you have a target hourly rate, it's worth checking what you'll actually keep after taxes with the freelance tax calculator or the self-employment tax calculator. If you're weighing freelancing against a salaried job, the salary calculator can help you compare the two on equal footing.