Freelance pricing calculator
Dividing the income you want by a 2,080-hour employee year gives $38 an hour for $80,000, and that rate can't pay it once unbilled time, costs and tax come out. Put in the income you want, the hours clients actually pay for, your costs and a tax set-aside, and you get an hourly floor, a recommended rate, a day rate and a project price, with the working shown so you can check it. It all runs in your browser.
Freelance hourly rate, using the defaults on this page: $80,000 target, 4 weeks off, 20 billable hours a week, $5,000 costs, 25% tax set-aside, 10% margin. That is 960 billable hours, $113,334 to invoice, a $119 an hour floor, and a $130 an hour quote.
- Works in any currency
Your take-home and your real hours
What you want to pay yourself for the year.
Holidays, sick days, and the gaps between clients.
Hours a client actually pays for. Time-tracking tools put a typical freelancer at 50 to 70% of the hours worked, so 20 to 28 in a 40-hour week is normal.
Software, gear, insurance, accounting, subscriptions.
Share of revenue you park for tax; many freelancers fold health insurance and retirement savings into the same set-aside. Ask your accountant what's right for you.
Buffer above the floor: slow months, unpaid invoices, growth.
A label for the results. The math is the same in every currency.
billable hours per year — revenue you need to invoice —
- Minimum hourly
- —
- Your floor. Below this you're subsidising clients.
- Recommended hourly
- —
- Floor plus your margin. Quote this.
- Day rate
- —
- 7.5 billable hours at the recommended rate.
- Example project
- —
- A 20-hour project at the recommended rate.
Take-home check: at the recommended rate you invoice — an hour and keep about — of it. The difference is the tax you're setting aside and what it costs to run the business. It is real money, but not money to spend.
Rates round up to the next whole dollar and are before GST or sales tax. Each figure rounds up from its own exact value, so multiplying the displayed rate by hours can land a dollar off. The tile is the accurate figure.
A worked example
The defaults above are a concrete case. Someone wants to pay themselves $80,000 a year, takes 4 weeks off, bills 20 hours a week, spends $5,000 a year running the business, parks 25% of revenue for tax and wants a 10% margin:
- Billable hours. 52 − 4 = 48 working weeks × 20 = 960 hours.
- Revenue needed. ($80,000 + $5,000) ÷ (1 − 0.25) = $113,334.
- The floor. $113,334 ÷ 960 = $119 / hr.
- The quote. +10% margin → $130 / hr, ~$974 day, ~$2,598 for 20 hours.
How the math works
This calculator gives an hourly rate, a day rate and a project price. The billable hours figure is yours to set, and it drives everything else. Time-tracking tools such as Harvest put a typical freelancer at roughly 50 to 70% of working hours billed, so if you are unsure, start inside that range.
- Billable hours per year = billable hours per week × (52 − weeks off). Time off isn't free for a freelancer; the remaining hours have to carry it.
- Revenue needed = (target income + business costs) ÷ (1 − tax set-aside). Dividing, rather than adding tax on top, is the part people miss: the set-aside comes out of every dollar you invoice, so the pool has to be bigger, not just taller.
- Minimum hourly = revenue needed ÷ billable hours. This is a break-even number, not a rate to be proud of.
- Recommended hourly = the floor × (1 + margin). The margin is what turns a job that pays the bills into a business that survives a bad quarter.
Every result rounds up to the next dollar, because rounding down means working the difference for free.
Questions
Why can't I just divide my target salary by 2,080 hours?
Because 2,080 is a full-time employee's year, and you aren't paid like one. An employer covers your slow weeks, gear, insurance and leave; a freelancer bills only some of their working hours and funds all of that from the rate. Divide a salary by 2,080 and you get a rate that quietly pays you a fraction of it. This calculator divides by your real billable hours and adds costs, tax set-aside and margin back in.
What about GST or sales tax?
The rates here are what you keep the business running on, before any GST, VAT or sales tax. In Australia, for example, once you're registered for GST you add it on top of your invoice and pass it on to the tax office; it was never your money, so it shouldn't be inside your rate. Registration rules and thresholds change, so check the current ones with your tax authority or accountant.
What actually counts as a billable hour?
Only time a client is paying for: work on their project, their meetings, their revisions. Proposals, invoicing, marketing, learning and email are real work but nobody pays for them, which is why time-tracking tools such as Harvest put a typical freelancer at roughly 50 to 70 percent of working hours billed. Getting this number right does more for an underpriced rate than any other input.
How do I raise my rate with existing clients?
Quote the new rate on all new work first, since new clients have no anchor. For existing clients, give notice one or two invoices ahead, name the date it changes, and don't apologize or over-explain. If a client only valued you at the old price, that is useful information; usually the fee was a smaller part of their decision than it felt from your side.
Should I price by the hour or by the project?
Use this hourly number as your floor, not your ceiling. When you can estimate a project's hours, quoting a fixed price often serves both sides better: the client gets certainty and you keep the gain when you're fast. Price the project as estimated hours times your recommended rate plus a buffer for revisions, and never below what the floor says those hours are worth.
Is the day rate just the hourly rate times 7.5?
Here, yes: 7.5 billable hours is a full day booked for one client. Treat it as a starting point. Some independents discount day bookings slightly because a whole committed day means no context switching; others charge more because it blocks everything else. Either way, derive it from your floor rather than guessing.
Does it work in pounds, euros, rupees or Australian dollars?
Yes. The math is currency-blind: enter your income target and costs in your own currency and every rate comes back in that same currency, so the calculator works unchanged in the UK, Australia, Canada, India, Europe or anywhere else. The currency selector only changes the label on the results. The one input you must localise is the tax set-aside, because that depends on your country's income tax and self-employment rules; your accountant can give you the right percentage wherever you are.
What's a realistic rate if I'm just starting out?
Start from your floor, not from a discount. The floor isn't a seniority prize; it's arithmetic on your own income target, hours and costs, and charging under it means paying to work. What does change for a beginner is the inputs: fewer billable hours while you find clients, and perhaps a lower income target while you build proof, and the calculator already turns both into a lower, defensible rate. Quote your floor plus a modest margin, then raise the rate as your weeks fill, instead of pricing off what other beginners charge.
Updated