Hourly Rate Calculator

How this calculator works

Add your desired yearly income to your yearly business expenses, then divide by your total billable hours (billable hours per week times weeks worked per year). Billable hours are hours you can charge for, which are always fewer than hours you work, because of admin, marketing and unpaid time. The result is the minimum hourly rate before income tax and self-employment tax.

Example

You want $80,000 a year, have $12,000 in business expenses, and expect 25 billable hours a week for 48 weeks. The calculator shows: Hourly Rate: $76.67.

Tips

• Be realistic about billable hours. Many freelancers bill only 20 to 30 hours in a 40-hour week.
• Raise your desired income to cover taxes, since this rate does not subtract them.
• Subtract vacation, holidays and sick days from the weeks worked to avoid undercharging.

Common questions

Why are billable hours lower than my working hours?

Time spent on sales, invoices, learning and admin is real work but you cannot bill it, so your billable time is smaller.

Does this rate include taxes?

No. Add enough to your income goal to cover income tax and self-employment tax.

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Results are estimates only. See our disclaimer.