Freelancer hourly rate calculator
Most freelancers price at whatever sounds reasonable, then find at the end of the year that the price never covered the tax. This starts from the other end: the net you want per month, the hours you actually bill, and what that comes to per hour.
The method is explained in full in the hourly rate pricing guide, and the other direction is in the annual net calculator.
What you want to take home after income tax and National Insurance.
Only hours someone pays for. Quoting, chasing payment, marketing and bookkeeping do not count, which is why the number is lower than a full work week.
Vacation, public holidays and sick days. The year is 52 weeks and the calculation subtracts this number from it.
Car, phone, software, professional insurance and office. Expenses are added on top of the required turnover, because they come out before anything is left for you.
The default 2.25 is the base for a man (2.75 for a woman).
Enter a monthly net and billable hours above zero, and fewer than 52 non-working weeks.
The rate that comes out
Where the number comes from
| Required annual turnover, before VAT | - |
| Annual business expenses | - |
| Taxable income after expenses | - |
| Income tax after credit points and the National Insurance deduction | - |
| National Insurance and health tax | - |
| Net for the year | - |
Pension and study fund deposits are not part of this calculation. They cut your tax but also leave your pocket, so anyone depositing needs a slightly higher rate than the one shown here. The exact effect is in the annual net calculator.
This calculator is an estimate and not tax advice. Billable hours are the easiest input to get wrong: counting hours worked instead of hours someone pays for produces a rate that is too low. What counts as a deductible expense is in the deductible expenses calculator.
Want to know whether the rate actually holds?
Slate tracks the hours and income that actually came in against what you planned.
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