data tool
Freelance rate calculator
A freelance hourly rate is the income you need plus your business costs, grossed up for tax, divided by the hours you can actually bill in a year. Enter those figures and the calculator gives an hourly rate, a day rate, the turnover it takes and a table of rates at different billable hours.
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- Runs on your device, nothing is uploaded
- Free, no sign in
- No watermark, no file limit
How it works
- 1
Set the income you want
The amount you would want as a salary, before income tax.
- 2
Add your business costs
Software, equipment, insurance, a co working desk, accounting, phone and internet for a year.
- 3
Be honest about time
Weeks off for holidays, sick days and quiet patches, and the hours each week you will really bill.
- 4
Read the rates
Hourly and day rates appear with the table, so you can see what billing more or fewer hours does.
Why billable hours set the rate, not 40
An employee is paid for every working hour. A freelancer is paid only for the hours a client is billed, and a large part of every week goes on work nobody pays for directly: finding clients, writing quotes, invoicing, chasing payments, admin and learning. Twenty five billable hours in a 38 hour week is common and still busy. That is why dividing a salary by 1,976 hours, a full time year, gives a rate that leaves a freelancer short. The calculator divides by the hours you can actually bill, and shows the billable share of a full time week so the gap is visible.
The set aside and what it covers
An employee's tax, retirement contributions and leave are handled by the employer. A freelancer has to fund them from what clients pay. The set aside percentage grosses the rate up so that after keeping that share back, the income and costs are still covered. Thirty percent is a common rule of thumb for income tax and superannuation or pension contributions together, but the right number depends on your country, your income and your structure. Keep the set aside in a separate account so tax time is not a shock.
From an hourly rate to a day rate
Many clients prefer a day rate or a project price to an hourly one, because it caps their cost. Multiply the hourly rate by the hours in a billed day; 7.5 is a common working day. Day rates often sit slightly under the hourly rate times hours, as a reward for the client booking a full day, which saves you a gap between jobs. For project pricing, estimate the hours generously, multiply by the hourly rate, and add a contingency for revisions.
Testing the rate against the market
The calculated rate is the rate you need, not necessarily one clients will pay. Compare it with what others charge for similar work in your area. If the market pays less, the levers are fewer weeks off, more billable hours, lower costs, a lower income target, or specialising in work that commands more. If the market pays more, charge it; the extra builds a buffer against a quiet month. The table makes the hours lever concrete.
Putting the rate in a quote
A rate on its own is easy to argue with. A quote that lists the deliverables, the estimated hours or days at your rate, and what is not included is easier to accept. The proposals module builds quotes with a pricing table of items, quantities, unit prices and tax, and the unit can be hours or days. Optional items let a client add extras themselves, which often lifts the total without a negotiation.
Revisiting the rate each year
Costs rise, skills grow and the market moves. Run the numbers again once a year, or after a big change such as a new piece of equipment or more weeks off. Raising rates for new clients first, and giving existing clients notice before applying the new rate to them, keeps the relationship intact.
Limits
- No tax is calculated. The set aside is a percentage you choose; check what you actually owe with an accountant or your tax office.
- It assumes a 52 week year and the same billable hours every working week.
- Rates in any currency work, as long as all the money figures use the same one.
- The result is a floor that covers your target, not what the market will pay.
What it does not do
- It does not compare your rate with others in your field.
- It does not handle GST or VAT; add that on top of the rate if you are registered.
- It does not store your figures.
Questions people ask
How much should I charge per hour as a freelancer?
Enough to cover your target income, your business costs and tax, spread over the hours you can bill. For $90,000 of income, $8,000 of costs and a 30% set aside over 46 weeks at 25 billable hours, the floor is about $122 an hour. Then check that against market rates.
How many billable hours are realistic for a freelancer?
Between 20 and 30 billable hours a week is common for someone full time, because quoting, admin, marketing and learning take the rest. Some specialists bill more through long contracts. Track your hours for a month to find your own figure before relying on it for a rate.
How do I turn an hourly rate into a day rate?
Multiply the hourly rate by the hours in a billed day. At $120 an hour and 7.5 hours, the day rate is $900. Many freelancers round down a little for full day bookings, since a booked day removes the unpaid gaps between smaller jobs.
Should my rate include GST or VAT?
Quote your rate excluding tax and add GST or VAT on top if you are registered. The tax is collected for the government, not earned. Tell clients whether a quoted rate includes tax, since businesses usually compare prices before tax and consumers after.
Why is a freelance rate so much higher than a salary per hour?
Because the freelancer pays for everything an employer usually covers: unbilled hours, holidays, sick days, equipment, insurance, retirement contributions and quiet months. An hourly salary of $45 for an employee often corresponds to a freelance rate well over $100 once those are counted.
Quote a project at your rate
Take what you made here into proposals.
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Background reading: the question page on this.
Written and checked by the OneCraft team. Last checked .