Freelance Rate Calculator
Work out the hourly and day rate you must charge to hit your income goal after expenses, taxes, and non-billable time - with a full breakdown.
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- No watermark
- No usage limit
About the Freelance Rate Calculator
The Freelance Rate Calculator turns an income goal into the hourly and day rate you actually have to charge to hit it, after expenses, tax, and the hours you can't bill. Type in what you want to keep, your yearly costs, the hours a week you can invoice, weeks you work, and a tax set-aside, and out comes the rate. It runs in your browser, nothing you enter is uploaded, and it shows every line of the working, so you can see where each dollar came from.
Most rate math makes one mistake, and it drives how the tax step works. When you reserve, say, 25% for tax, the tempting move is to take your target and add 25% on top, which is exactly backwards. Tax comes out of your total revenue rather than your take-home, so you have to gross the number up rather than just mark it up, and the gap between those two is real money in your pocket. A lot of quick calculators, and most people running it in their head, get this exact step wrong. This one grosses it up for you every time.
One thing up front. The rate it gives you is a floor, the least you can charge and still hit your goal after costs and tax, not a ceiling. What a client will pay is a separate question, and for good work it's usually higher.
How to use
- Enter the income you want to keep. Your take-home target, the money left after tax and business costs, the number you actually live on.
- Add your yearly business expenses. Software, insurance, your accountant, payment fees, marketing, all of it. Leave it blank and it counts as zero.
- Set your billable hours per week, not your working hours. Only the hours you can genuinely invoice, which for most freelancers sits well under 40 (more on that below).
- Set weeks worked per year. Knock off holidays, sick days, and the slow gaps between clients. 46 to 48 is more honest than 52.
- Add a tax set-aside percent. Roughly the share of revenue that goes to tax before you pay yourself. The tool grosses your target up so what's left after tax still lands on your goal.
- Read the breakdown. Hourly and day rate are the two bold rows. Everything above them shows the working, so you can see where the number came from.
Change any field and the whole thing recalculates as you type. Leave a required box empty and you get a plain prompt instead of a broken result.
The tax set-aside, done right
Say you need $90,000 in your pocket after tax and you want to hold back 25%. The add-on math says $90,000 plus 25%, which is $112,500. Bill that and you come up short, because 25% of $112,500 is only about $28,000 of tax, leaving you around $84,000 to live on, not the $90,000 you aimed for. The right math divides: $90,000 divided by 0.75 is $120,000. Check it, 25% of $120,000 is exactly $30,000 of tax, and that leaves your $90,000 intact. The add-on shortcut costs you $7,500 on this one goal, and it repeats every year you use the wrong number.
You can watch this in the breakdown. Load the defaults and the rate is $80 an hour. Set the tax to zero and it drops to $60. That $20 is the tax grossed up and folded into your rate, the part the add-on math would leave you covering yourself.
Honest caveat, because this one matters. The set-aside here applies one flat percentage across the board rather than working through brackets the way a real return does. Self-employment tax (15.3% toward Social Security and Medicare), income tax, and your state all interact, and deductions move the number. Use it to price and plan, then get the real figure from a tax pro once your income settles. The IRS self-employment tax page is the right starting point for US freelancers.
Billable hours, not the hours you work
The second number people get wrong is hours, and it costs the most. Plenty of calculators happily let you type 40 and multiply. This one asks for billable hours on purpose, because the hours you can actually invoice are the only ones that pay you.
Think about a normal 40-hour week. How much of it does a client ever see on an invoice? Not the proposals, not chasing the invoice that's three weeks late, not your own bookkeeping, not the sales calls that go nowhere, not the dead stretch between one project wrapping and the next kicking off. That work is real, it just doesn't bill. Most freelancers invoice around 60 to 70 percent of their hours, so a 40-hour week is really 24 to 28 billable ones. Price as if all 40 are billable and you undercharge by a third and never feel it happen.
Taking more time off actually raises your rate. Your yearly goal doesn't shrink when you take a week off, but the hours you spread it across do, so each remaining hour carries more. Drop your weeks worked from 52 to 46 and the hourly figure climbs. That climb is just the cost of your time off getting priced into the hours you do bill.
Think in a utilization percentage instead of raw hours? Multiply first. 40 hours times 0.65 is about 26 billable a week, and that's what goes in the box.
Turning it into a day rate
Lots of clients would rather agree on a day rate than count hours, and the calculator gives you one. A billable day tends to be about six hours once you subtract email, context-switching, and the small tasks you can't invoice. So your day rate is your hourly rate times your billable hours per day, not eight. At the default $80 an hour and six billable hours that's a $480 day. Quote eight and you'd say $640 for work you can't actually deliver. If anything, nudge it a touch higher, since booking your whole day costs the client flexibility.
Frequently asked questions
What percentage should I set aside for tax?
A conservative combined guess covering self-employment tax plus income tax. Self-employment tax alone is 15.3%. Add federal and your state's income tax and 25 to 35% is realistic for many US freelancers, higher in a high-tax state, lower once you have real deductions. Round up when you're unsure, because setting aside a bit extra just means refunding yourself in April. It's a planning figure for setting your rate, so the real number comes off your tax return.
Should I charge exactly what the calculator says?
Treat it as your floor, then round up for the quote you send. If it reads $77.34, quote $80. A clean number is easier to say and to hold, and stays above the minimum. The floor says nothing about what the market will bear, which for experienced people is usually higher. A decent tell you're underpriced: clients say yes to every quote without a flicker. If that's happening, your rate has room to move.
Why is my rate two to three times an old hourly wage?
Because you now cover everything the employer used to. They matched your 7.65% payroll tax, so self-employed you owe the full 15.3% yourself. They funded health insurance, retirement, and paid time off, all on you now, and they paid you for the whole week even though a chunk of it wasn't billable. Add those back and a salaried wage often needs a freelance rate two to three times as high to match the same real pay.
What should I count as a business expense?
Anything you pay out of freelance revenue to do the work. Software subscriptions, hardware, professional insurance, your accountant, payment-processor fees, a coworking desk, marketing. The mistake is guessing the total. Track every fee for a quarter, then multiply to a year, and the honest figure is almost always higher than your guess.
How often should I revisit my rate?
At least once a year, and at every contract renewal you reasonably can. A rate you never touch is a slow pay cut, because your own costs (insurance, software, rent) climb whether or not your rate does. A small bump each renewal is easy for a client to take. Sitting flat for three years then asking for a big jump is a much harder conversation. Weighing a return to a salaried job instead? Run it the other way with a salary calculator to compare like for like.
Does this work outside the US?
The core math is currency-agnostic. Income goal plus expenses, grossed up for tax, divided by billable hours holds in any currency. The one piece to localize is the tax set-aside, since the 15.3% self-employment figure is US-specific and every country has its own contributions and tax bands. Put in your local effective rate and the rest follows. Adjust weeks worked to your own holidays, and read whichever period (hourly, day, monthly) matches how your clients pay.