1. Build your income requirement
Start with your desired take-home pay, then account for taxes, business expenses, insurance, benefits, savings, and financial risk.
Freelance pricing calculator
Freelance Hourly Rate Calculator
Calculate a sustainable freelance hourly rate using your take-home income goal, taxes, business expenses, billable hours, time off, and profit or savings buffer.
Instant recommended rate
Time-off planning
Tax and profit buffer
Calculate your sustainable freelance rate
Enter your annual income goal, business costs, tax assumptions, available time, and billable capacity.
This calculator provides a planning estimate, not tax or legal
advice. Actual pricing should also reflect your experience,
specialisation, demand, client value, scope risk, market
conditions, and payment terms.
How the Freelance Hourly Rate Calculator works
The calculator determines the annual revenue your business must generate, then divides that target by realistic billable hours rather than every hour you expect to work.
2. Estimate true billable capacity
Remove holidays, sick leave, training, administration, marketing, proposals, invoicing, and other non-billable activities from available time.
3. Convert the target into rates
Annual revenue is divided by billable hours to calculate the recommended hourly rate, day rate, and example project price.
Pre-Tax Income Requirement
Desired Take-Home Income ÷ (1 − Estimated Tax Rate)
Annual Revenue Target
(Pre-Tax Income + Expenses + Benefits)
× (1 + Profit Buffer + Risk Buffer)
Recommended Hourly Rate
Annual Revenue Target ÷ Annual Billable Hours
Pricing signal
Possible meaning
What to review
Very low billable utilisation
Limited revenue capacity
Review time spent on administration, marketing, proposals, revisions, meetings, support, and unpaid client work.
High required rate
Strong income or cost target
Consider specialisation, value-based pricing, retainers, productised services, larger projects, or reducing expenses and non-billable work.
Rate below break-even
Unsustainable pricing
A rate below the break-even figure may not cover your income goal, taxes, business costs, benefits, and time away from client work.
Strong financial buffer
Greater business resilience
Buffers can help absorb late payments, quiet periods, unexpected revisions, equipment replacement, training, and future investment.
Frequently asked questions
Important details for setting a sustainable freelance hourly rate.
How is a freelance hourly rate calculated?
Estimate the annual revenue required to cover your take-home income, taxes, business expenses, benefits, time off, and profit buffer. Divide that amount by realistic annual billable hours.
Why should I not divide by all working hours?
Freelancers spend substantial time on marketing, proposals, administration, invoicing, learning, meetings, and business development. These hours are necessary but often cannot be billed directly.
What business expenses should be included?
Include software, equipment, internet, workspace, professional services, marketing, payment fees, travel, training, insurance, licences, and other costs required to run the business.
Should taxes be added to my hourly rate?
Your rate should generate enough pre-tax profit to leave the desired take-home income after estimated taxes. Tax rules differ, so use a realistic planning percentage and obtain professional advice.
What is billable utilisation?
Billable utilisation is billable client time divided by total working time. It shows how much of your weekly capacity directly generates client revenue.
Should I charge the calculated rate to every client?
Not necessarily. Adjust pricing for urgency, complexity, value, risk, usage rights, revisions, payment terms, client size, project duration, and strategic importance.
Is hourly or project-based pricing better?
Hourly pricing is useful when scope is uncertain. Project, retainer, or value-based pricing may reward efficiency and create clearer client budgets when scope and outcomes can be defined.
How often should I review my freelance rate?
Review it at least annually and whenever expenses, tax assumptions, demand, experience, utilisation, positioning, services, or income goals change.