How to use the freelance rate calculator
- Enter your target take-home income.
- Add yearly business expenses — software, equipment, insurance.
- Set your effective tax rate.
- Be honest about billable hours — admin and sales take real time.
The formula
Rate = (Income ÷ (1 − tax) + Expenses) ÷ (Billable hours/week × (52 − weeks off))
This is a floor, not a market rate. Price on value where you can.
Worked example
To take home 90,000 with 9,000 in expenses, 28% tax and 25 billable hours for 46 weeks, you need roughly 120 per hour — far above a naive 'salary ÷ 2,080 hours'.
Tips from the numbers
- Most freelancers bill 50–70% of working hours.
- Raise rates for new clients first.
- Offer packages or retainers to smooth income.
Watch: learn the concept
Frequently asked questions
Why not divide salary by 2,080?
Employees get paid holidays, benefits and employer tax contributions; freelancers pay for all of that themselves.
Hourly or project pricing?
Hourly is simple; project or value pricing rewards efficiency. Use this rate as a floor for estimates.
How often should I raise prices?
Review at least yearly and when demand exceeds your capacity.
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