Freelance Hourly Rate Calculator
Enter the income you want, your business expenses, taxes and how much of your time is actually billable. The calculator works out the minimum hourly and day rate you need to charge — and shows every step.
Software, equipment, insurance, accounting, internet, coworking
Your combined income and self-employment tax rate
Holidays, vacation and sick days
The rest goes to sales, admin, email and learning
Covers slow months, retirement and growth
Minimum hourly rate
$79.10
per billable hour
Day rate
$633
8 billable hours
Revenue target
$94,600
per year, before tax and expenses
How it adds up
- Pre-tax income for $60,000 take-home
- $80,000
- + Business expenses
- $6,000
- + 10% buffer
- $8,600
- = Revenue you need
- $94,600
- Working weeks
- 46 weeks
- Billable hours per year
- 1,196 h (26 h/week)
- Revenue ÷ billable hours
- $79.10/h
- Take-home at this rate (after expenses and tax)
- $66,450
Project price examples at this rate
5-hour project
$395
10-hour project
$791
20-hour project
$1,582
40-hour project
$3,164
This is the minimum rate that meets your goals, using a simple flat tax estimate. Market rates for your skills and location may be higher — charge what the value and market support, not just your costs.
Results are estimates for planning only. Prices, limits and real-world usage vary — always confirm against the provider's official documentation or your own measurements before making decisions.
Find a rate that actually pays the bills
The most common mistake new freelancers make is dividing their old salary by 2,080 hours and charging that. It ignores everything an employer used to cover: software, equipment and insurance, paid holidays and sick days, the employer’s share of taxes — and the many hours spent finding clients, sending invoices and answering email that nobody pays for. This calculator works backwards from the income you want to the minimum hourly and day rate that actually delivers it.
How to use the calculator
- Enter the income you want per year, and choose whether it’s after tax (take-home) or before tax.
- Add your yearly business expenses — tools, hardware, insurance, accounting, coworking and professional fees.
- Enter an estimated tax rate that combines income tax and any self-employment tax.
- Set your weeks off, hours per week and the share of your time that’s billable.
- Add a buffer for slow months and savings, then read your minimum hourly rate, day rate and revenue target.
The formula
- Pre-tax income = take-home income ÷ (1 − tax rate)
- Revenue needed = (pre-tax income + business expenses) × (1 + buffer)
- Billable hours = (52 − weeks off) × hours per week × billable share
- Hourly rate = revenue needed ÷ billable hours
Example: to take home $60,000 at a 25% tax rate, you need $80,000 before tax. Add $6,000 of expenses and a 10% buffer and the revenue target is $94,600. Working 46 weeks at 40 hours with 65% billable gives 1,196 billable hours, so your minimum rate is about $79 an hour — far above the $29 an hour that $60,000 ÷ 2,080 suggests.
Billable hours are the key number
Nobody bills 40 hours a week, every week. Sales calls, proposals, admin, bookkeeping, learning and gaps between projects all take time. Many freelancers bill well under three-quarters of their working hours, especially early on. If you’re unsure of your own figure, track your time for a month — then update the billable share here for a realistic rate.
Beyond the minimum
This calculator gives the rate you need, not the rate you should charge. Check what clients pay for your skills in your market, and charge for the value you deliver: a specialist who solves an expensive problem can charge far more than their cost-based minimum. Many freelancers also move from hourly billing to fixed project prices or retainers once they can estimate reliably — use your hourly rate as the floor for those quotes.
Once you’ve set your rate, bill clients with the Invoice Generator, plan your US quarterly taxes with the 1099 Estimated Tax Calculator, and price bigger builds with the Software Development Cost Calculator.
Frequently asked questions
How do I calculate my freelance hourly rate?
Add your target pre-tax income and yearly business expenses, add a buffer, then divide by the hours you can actually bill in a year. Billable hours are your working weeks × hours per week × the share of time spent on paid client work.
Why is my freelance rate so much higher than my old salary per hour?
As a freelancer you pay for your own equipment, software, insurance and time off, may pay extra self-employment taxes, and can't bill for sales, admin or gaps between projects. The rate has to cover all of that from fewer billable hours.
What share of my time will be billable?
It varies a lot. Many freelancers spend a significant part of the week on finding clients, admin and learning. Track your own time for a few weeks to find your real figure and update the calculator.
Should I charge hourly or per project?
Use your hourly rate as a floor. For well-defined work, a fixed project price based on estimated hours plus a margin often earns more and is easier for clients to approve.
How accurate is the tax figure?
The calculator uses a single tax rate you enter, which is a simplification. For US self-employment tax and quarterly payments, use our 1099 Estimated Tax Calculator, or ask an accountant.
Related tools
Free Invoice Generator (USD/CAD)
Create a professional invoice with US sales tax or Canadian GST/HST/PST and download a PDF.
1099 Quarterly Estimated Tax Calculator
Estimate quarterly taxes for freelancers: SE tax, federal income tax and due dates.
Software Development Cost Calculator
Get a rough cost and timeline range for a software project from features, team and rates.