Free Freelance Rate Calculator · No Signup
Freelance hourly rate calculator — what should you actually charge?
Work backward from the income you actually want, your business expenses, and how many hours you can realistically bill — not just guess a round number. Or flip it around and check what a rate you're already charging will really earn you.
This is a planning estimate, not tax or financial advice — it doesn't know your country, bracket, or actual expenses. Adjust the assumptions above to match your real situation.
Why "hours worked" and "billable hours" aren't the same number
A common first mistake is dividing a target income by 40 hours a week, 52 weeks a year — that's the number of hours in a full-time schedule, not the number of hours a freelancer can actually bill a client for. Time spent on proposals, invoicing, marketing, professional development, client calls that don't get billed, and ordinary downtime between projects doesn't disappear — it just isn't billable. Most freelancers realistically bill somewhere between half and three-quarters of a working week, and few work all 52 weeks without any time off. Using more realistic numbers for both produces a rate that actually supports the income you're aiming for, instead of quietly falling short of it.
Why grossing up for taxes matters
As a freelancer, nobody withholds tax from what a client pays you the way an employer withholds it from a paycheck — you're responsible for setting that aside yourself, and in many places you also cover a portion an employer would otherwise pay. Treating your full billing rate as "income" without setting anything aside is one of the most common ways new freelancers end up short at tax time. Building a tax set-aside percentage into the rate itself, rather than an afterthought, is the more sustainable way to price.
A worked example
Say you want to take home $70,000 a year, expect around $6,000 in annual business expenses (software, insurance, a home office share), plan to set aside 25% for taxes, and can realistically bill 25 hours a week across 48 working weeks a year:
- Billable hours per year: 25 × 48 = 1,200 hours.
- Income plus expenses: $70,000 + $6,000 = $76,000.
- Grossed up to cover the 25% tax set-aside: $76,000 ÷ (1 − 0.25) = $101,333.
- Hourly rate: $101,333 ÷ 1,200 hours ≈ $84.44/hour.
Notice how much higher that is than the naive "$70,000 ÷ 2,000 hours (a 40-hour week, 50 weeks) = $35/hour" calculation most people start with — the gap is entirely the business expenses and tax set-aside that a plain full-time-hours division leaves out.
Hourly vs. fixed-price pricing
An hourly rate is simplest to reason about and protects you if a project runs long, but it also means your income is capped by the hours you can personally bill, and some clients dislike an open-ended number before work starts. Fixed-price (project-based) pricing gives the client cost certainty and can pay better per hour if you're fast or experienced at the work — but you absorb the risk if it takes longer than expected. A common approach: use this calculator to find your real hourly rate first, then price fixed-cost projects by estimating the hours honestly (with room for scope creep) and multiplying — never by guessing a project price directly. Once you have a number, you can start either an hourly invoice or a fixed-price invoice.
When to revisit your rate
A rate isn't a one-time decision. Worth recalculating whenever: your business expenses change meaningfully (new software, more insurance, a bigger workspace), your income goal changes, you've gained enough experience or a strong enough portfolio that the market will bear more, or it's simply been a year or more since you last checked. Many freelancers review their rate annually even if nothing obviously changed — costs creep up quietly, and a rate that was right two years ago rarely still is.
Mistakes people make when setting a freelance rate
- Copying someone else's rate. Their expenses, tax situation, billable hours, and target income are all different from yours — a rate that works for them may not clear your own numbers at all.
- Assuming every working hour is billable. Covered above — use a realistic billable-hours number, not a full 40-hour week.
- Forgetting business expenses entirely. A rate that only covers your desired take-home, with $0 for expenses, is quietly asking your business costs to come out of your own pocket instead.
- Not adjusting the rate as expenses or goals change. A rate set a year or two ago, before a price increase in your tools or a change in your income goal, can quietly become too low without ever being deliberately reconsidered.
- Treating the result as fixed and final. This is a planning estimate to sanity-check a rate against your own numbers — market conditions, experience level, and what clients will actually pay all matter too.
Who this is for
- New freelancers setting a rate for the first time, without a previous rate to anchor to.
- Freelancers raising their rates who want a number grounded in their actual costs and goals, not just a guess.
- Consultants and contractors sanity-checking whether a rate a client is offering will actually clear their own numbers.
- Anyone switching from salaried to freelance work who needs to translate a target salary into an hourly billing rate.
Once you've settled on a rate, you can create an hourly invoice or a freelance invoice using it directly.
Common questions
Is this freelance rate calculator free?
Yes — completely free, with no signup and no account required.
How is the recommended hourly rate calculated?
It adds your desired annual income to your annual business expenses, grosses that up to cover the tax percentage you set aside, then divides by your billable hours per year (billable hours per week × working weeks per year). The result is the rate that clears all three — income, expenses, and taxes — at the hours you actually expect to bill.
Why is "billable hours per week" less than 40?
Because a full-time week isn't a full-time week of billable work. Marketing, admin, invoicing, client calls that don't get billed, learning, and simple downtime between projects all eat into a 40-hour week — most freelancers realistically bill somewhere between 20 and 30 hours of a working week, not all of it. Using 40 here understates what you actually need to charge per hour.
What should I put for annual business expenses?
Anything you pay for the business that isn't part of your personal take-home income — software subscriptions, insurance, a portion of home office costs, equipment, coworking space, accounting fees, and similar. If you're just starting out and don't know yet, a rough estimate is far better than leaving it at zero, since zero means your rate is only covering your income, not the cost of running the business.
What's a reasonable tax set-aside percentage?
It depends heavily on your country, income level, and business structure, so there's no single right number — many freelancers use something in the 25-30% range as a starting estimate, then adjust based on their own actual tax situation or an accountant's advice. This calculator only applies whatever percentage you enter; it doesn't know your specific tax bracket or jurisdiction.
Does this account for my specific country's tax rules?
No — the tax set-aside field is a single flat percentage you choose, not a real tax calculation for any specific country or bracket. Treat the result as a planning estimate, not a substitute for an accountant or your local tax authority's guidance.
Does this calculator save my numbers anywhere?
No — everything happens in your browser and nothing is sent to or stored on our servers. Refreshing the page clears it.
Can I use the rate I calculate to create an invoice?
Yes — once you've calculated a rate in "What should I charge?" mode, click "Create an hourly invoice at this rate" and it opens our invoice generator with a line item pre-filled at that rate, ready to adjust for the actual hours worked.
Should I charge every client the same rate?
Not necessarily. This calculator gives you a floor — the minimum that clears your income, expenses, and tax goals at your normal billable hours. Many freelancers charge more for smaller/rush jobs that eat disproportionately into admin time, or for clients whose work is more specialized or higher-stakes, and some offer a modest discount for large, steady, low-hassle retainers. The number here is a baseline to negotiate from, not a single price that has to apply everywhere.
What if I only freelance part-time?
Lower your "billable hours per week" to whatever you realistically bill alongside your other work or commitments — the same formula still applies, it just spreads your income and expense goals over fewer hours, which produces a higher hourly rate than a full-time schedule would.
How do I actually raise my rate with existing clients?
Recalculate here first so you have a specific, justified number rather than a round-number guess, then give existing clients advance notice (30-60 days is common) rather than an on-the-spot change on the next invoice. Framing it around rising costs or added experience tends to land better than framing it as "I decided I want more."
Does this work for project-based (fixed-price) pricing too?
Indirectly — calculate your hourly rate here first, then estimate how many hours a fixed-price project will realistically take (padding for the inevitable scope creep) and multiply. The calculator itself only outputs a per-hour number, not a project quote.
More general questions? See our full FAQ.
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