Pay & rates
Freelance Rate Calculator
Spread desired income and explicit annual costs across billable hours.
Use this planning model to expose billable-time and cost assumptions, not as a market-rate promise.
What the result means
The rate covers only the supplied target and costs over billable hours. It does not predict demand, taxes, utilization, or market acceptance.
The formula
(Desired annual income + annual business costs) / annual billable hours
Results are displayed to at most two decimal places. Calculations use the unrounded inputs.
A worked example
Put the formula to work
- Desired annual income (currency per year)
- 60,000
- Annual business costs (currency per year)
- 12,000
- Annual billable hours (hours)
- 1,000
Planning hourly rate (input currency): 72.00
A 60,000 income target plus 12,000 costs over 1,000 billable hours gives 72 per hour.
How to use this calculator
- Set an income target.
- List included business costs.
- Estimate realistic billable hours, not all working hours.
- Divide the total by billable hours and review assumptions.
Why this number matters
Separating billable from total time helps prevent an attractive rate from hiding unpaid work.
Input definitions
- Desired annual income (currency per year)
- Income target before personal tax.
- Annual business costs (currency per year)
- Tools, insurance, equipment, and other included costs.
- Annual billable hours (hours)
- Client-billable hours; must be greater than zero.
Assumptions and limitations
- No external rates, statutory advice, or demand assumptions are used.
- Tax, holidays, sick time, and nonbillable work need separate treatment.
Methodology
The default result and worked example use the same calculation functions as the interactive tool. The formula cannot verify the quality or scope of your source data.
Read our calculation methodology
Last updated .