This freelance rate calculator works out the minimum hourly and day rate you need to charge to reach your income goal. It accounts for business costs, taxes, time off and the fact that not every working hour can be billed.
How the rate is calculated
- Gross up your take-home goal for tax: income ÷ (1 − tax rate).
- Add your yearly business costs.
- Add a buffer for slow months and late payers.
- Divide by your billable hours: (52 − weeks off) × billable hours per week.
Worked example
To keep $60,000 after a 30% tax rate, with $8,000 of costs, 6 weeks off, 25 billable hours a week and a 10% buffer, you need revenue of about $103,086 a year. Over 1,150 billable hours, that is a minimum of $89.64 an hour, or $717 a day.
Why freelance rates look high
A freelancer pays costs an employer would normally cover: equipment, software, insurance, retirement savings, unpaid holidays and sick days, and both halves of payroll taxes. Time spent finding clients, invoicing and learning is also unpaid. A rate that seems high compared with a salary often works out about the same.
Tips for setting your rate
- Treat this result as your floor, then price by value and market rates in your field.
- Consider project or retainer pricing once you can estimate work reliably.
- Review your rate at least once a year.
Frequently asked questions
How many billable hours do freelancers work?
Commonly 20 to 30 hours a week. The rest of a full working week goes on admin, marketing, proposals and learning.
What tax rate should I use?
Combine income tax and self-employment tax. Many US freelancers set aside 25% to 35% of profit; use your own past returns if you have them.
Should I charge hourly or by project?
Hourly suits uncertain scope; project pricing rewards efficiency and is easier for clients to budget. Many freelancers use this hourly rate to price projects.
How do I compare a freelance rate with a salary?
A common rule of thumb is to divide a salary by 1,000 to get a comparable freelance hourly rate, because freelancers bill fewer hours and pay their own costs.
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Last reviewed: October 2026. For information only; not financial, tax or legal advice.