Freelance Rate Calculator

Why freelancers under-charge

The usual mistake is to take a salary, divide by 2,080 hours and call that the rate. It ignores three things: a freelancer pays their own costs, loses weeks to holidays and illness, and spends a large part of every week on work nobody pays for — quotes, invoices, admin, finding the next client. Build the rate from what you need, not from what an employee earns.

Formula

• Billable hours = weeks × hours a week × billable share
• Revenue needed = (income + costs) ÷ (1 − tax rate)
• Hourly rate = revenue ÷ billable hours

Worked example

To take home 900,000 a year with 120,000 of costs and 15% going to tax and platform fees, you need to bill 1,200,000. With 46 working weeks, 40 hours a week and 65% of them billable, that is 1,196 billable hours — a rate of about 1,004 an hour, or 8,030 a day.

How to use the calculator

1. Start with the income you want to keep, not what you think clients will pay.
2. Add every business cost: software, internet, hardware amortised over its life, co-working, accounting.
3. Be honest about the billable share. 60–70% is realistic for an established freelancer; 80% is rare and usually not sustainable.

If the number looks too high

• It usually is not. Compare it against agency rates for the same work — they are several times higher.
• Quote projects, not hours. Clients compare hourly rates and judge value by outcome.
• Raise the billable share before lowering the rate: fewer, bigger clients means less unpaid time.
• Working with foreign clients, check what a comparable local freelancer there charges before you anchor low.

Frequently asked questions

How much should a freelancer charge per hour?

Enough that the billable hours cover your income, your costs and your tax. Enter those three above and the rate falls out — guessing from a salary nearly always lands too low.

What percentage of my hours will be billable?

For most established freelancers, 60 to 70%. The rest goes to proposals, invoicing, admin and finding work — all real, all unpaid.

Should I charge by the hour or by the project?

Quote projects where you can: clients prefer a fixed number and you keep the gain when you work faster. Use this rate as the floor you price those projects from.