Hourly Rate Calculator
Find the minimum hourly rate you need to charge to hit your income goal — factoring in billable hours, taxes, and expenses.
Your minimum rate covers your take-home income, business expenses, and taxes. It's the floor — not the ceiling. Most freelancers should add a 20–50% buffer on top for profit, scope creep, and negotiation room.
Gross Revenue Needed = (Income + Expenses) ÷ (1 − Tax Rate)
Billable Hours = Weeks × Hours per Week
Minimum Rate = Gross Revenue ÷ Billable Hours
Suggested Rate = Minimum Rate × 1.25
How do I calculate my freelance hourly rate?
Start with your target annual take-home income, add business expenses and gross up for taxes, then divide by your billable hours per year. This gives you your minimum viable rate — add a 20–50% buffer on top.
What percentage of my hours are actually billable?
Most freelancers are only 50–70% billable. The rest goes to admin, marketing, sales, and professional development. A common benchmark is 1,000 billable hours per year (roughly 20 hours/week × 48 weeks).
Should I charge more than my minimum rate?
Yes — the minimum rate is the floor, not the target. Add 20–50% for profit margin and negotiation room. The market rate for your skills may already be well above your minimum.
How do taxes affect my hourly rate?
As a freelancer you pay self-employment tax on top of income tax — often 25–40% effective. You must gross up your rate to account for this. Use the tax rate field above to model your specific situation.
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