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Freelance Rate Calculator

Find the hourly and day rate you need to take home your target income after tax, expenses and time off.

Result

Revenue needed per year

$88,000.00

Revenue needed per month

$7,333.33

Billable hours per year

1,150

Day rate

$382.61

Minimum hourly rate

$76.52

Embed this calculator on your site

Copy this code and paste it into your page's HTML. The calculator is free to use and resizes itself to fit.

How it's calculated

Revenue needed = take-home income ÷ (1 − tax rate) + business expenses. Billable hours per year = billable hours per week × (52 − weeks off). Hourly rate = revenue needed ÷ billable hours; day rate assumes a 5-day week.

This freelance rate calculator finds the minimum hourly and day rate you need to reach a take-home income goal. It works backward from your target income, tax, business expenses, billable hours and weeks off. Use the result as a floor for your pricing.

The formula

revenue needed = take-home income / (1 - tax rate) + business expenses
working weeks  = 52 - weeks off
billable hours = billable hours per week x working weeks
hourly rate    = revenue needed / billable hours
day rate       = hourly rate x (billable hours per week / 5)
monthly revenue = revenue needed / 12

The tax rate is capped at 99%. If billable hours are zero, the rate is 0.

Worked example

Inputs: take-home $60,000, expenses $8,000, tax 25%, 25 billable hours a week, 6 weeks off.

  • Revenue needed per year: $88,000.00
  • Revenue needed per month: $7,333.33
  • Billable hours per year: 1,150
  • Hourly rate: $76.52
  • Day rate: $382.61

How to read the result

The hourly rate is a minimum. It covers your goal only if you fill every billable hour you planned.

  • Add a margin for slow months and unpaid work.
  • Lower your billable hours first if the rate looks high. Real utilization is often below plan.
  • Tax is taken from profit here, after expenses are deducted from revenue. Tax systems differ, so confirm the method with an accountant.
  • Check the number against your market. A rate far above local norms needs a clear value story.

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Frequently asked questions

How do I calculate my freelance hourly rate?
Work out the revenue you need: take-home income divided by one minus your tax rate, plus business expenses. Divide that by your billable hours per year. The result is your minimum hourly rate.
Why use billable hours and not 40 hours a week?
You cannot bill all your time. Admin, sales, learning and gaps between jobs take hours. Enter only the hours you can invoice. A lower number gives a higher, more realistic rate.
What tax rate should I enter?
Enter your expected effective rate, meaning total tax divided by profit. It is not the top bracket. Rules and rates differ by country, so ask a tax authority or an accountant for a figure.
Does the rate include holidays and sick days?
Yes, through the weeks-off field. The calculator subtracts those weeks from 52, so your paid time off is covered by the hours you do bill.
How is the day rate calculated?
The day rate is the hourly rate times billable hours per week divided by five. With 25 billable hours a week, a day holds five billable hours.