Freelance Hourly Rate Calculator
Find the hourly rate you need to hit your take-home income goal.
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How this calculator works
Most new freelancers pick a rate by taking their old salary and dividing by 2,080 hours (40 hours × 52 weeks). That number is almost always too low, because a freelancer pays their own taxes, covers their own expenses, and cannot bill every hour they work. Admin, sales calls, invoicing and learning all take time that no client pays for.
This calculator works backwards from the money you actually want to keep. It first adds the tax you will owe on top of your take-home goal, then adds your yearly business expenses, and finally spreads that total across only the hours you can realistically bill.
The formula
Profit before tax = take-home goal ÷ (1 − tax rate)
Revenue needed = profit before tax + business expenses
Billable hours = billable hours per week × (52 − weeks off)
Hourly rate = revenue needed ÷ billable hours
Worked example
You want to keep $60,000 a year, you spend $6,000 on business costs, and you expect about 25% of your profit to go to taxes. $60,000 ÷ 0.75 = $80,000 of profit before tax, plus $6,000 of expenses = $86,000 of revenue. If you bill 25 hours a week and take 6 weeks off, you have 25 × 46 = 1,150 billable hours. $86,000 ÷ 1,150 ≈ $74.78 per hour. That is far above the $28.85 you would get by dividing $60,000 by 2,080 hours.
Tips for setting your rate
- Treat the result as a floor, not a price. It is the minimum that keeps your business healthy. Experience, niche skills and fast turnaround all justify charging more.
- Be honest about billable hours. Many full-time freelancers bill 20–30 hours a week. If you are just starting, assume fewer.
- Check your tax rate. Your real rate depends on where you live and your deductions. A tax professional can give you a better estimate.
- Review it every year. Expenses rise and your skills grow. Re-run the numbers before you renew client contracts.
Frequently asked questions
What is a good number of billable hours per week?
A common range for full-time freelancers is 20 to 30 billable hours per week. The rest of the working week usually goes to finding clients, communication, invoicing and admin.
Should I include health insurance and retirement savings?
Yes. If you no longer get these from an employer, add them to your business expenses or raise your take-home goal so the rate covers them.
Is it better to charge hourly or per project?
Many freelancers use their hourly rate to estimate a project price, then quote a flat fee. Knowing your minimum hourly rate tells you whether a fixed-price project is worth taking.
Does this calculator give tax advice?
No. The tax rate is a simple estimate you enter yourself. For exact numbers, check your local tax rules or speak with an accountant.