How this calculator works
A freelance rate has to cover more than the hours you spend on a client’s work. It also has to cover the hours you do not bill, the cost of running the practice, time off, and tax. This calculator uses a straightforward desired-income method: it asks what you want to take home in a year, adds your business expenses, grosses that up for an effective tax rate you choose, and divides the revenue you need by the hours you are likely to bill.
The formula is:
Revenue needed = annual expenses + (desired take-home ÷ (1 − tax rate)). Then hourly rate = revenue needed ÷ billable hours. Billable hours are the hours you can work each week, times the weeks you actually work (52 minus time off), times your utilization rate. If you want $60,000 take-home, have $8,000 of expenses, set aside 4 weeks, work 40 hours a week, bill 60% of those hours, and use a 30% effective tax rate, you need 1,152 billable hours and about $93,714 of revenue, which is $81.35 an hour. Change any input and the rate moves with it.
Utilization is the piece people most often skip. Proposals, bookkeeping, invoicing, marketing, unpaid revisions, and admin are real work, but they are not billable unless a contract says so. Many independent practitioners bill somewhere around half to two-thirds of the hours they are available. A 60% default is a planning assumption, not a benchmark you have to hit. If you already know your own figure from last year’s calendar, use that. A lower utilization means each billable hour has to carry more of the year.
The tax field is an effective rate you choose, applied to profit (revenue minus expenses) as a planning estimate. It is not a tax return and it is not advice. In the United States, self-employment tax is 15.3% of net earnings (12.4% Social Security, up to the annual wage base, and 2.9% Medicare, with an extra 0.9% Medicare tax at higher incomes). Income tax is additional and depends on filing status, deductions, and credits. You can deduct one-half of self-employment tax when you figure income tax, which is one reason a single “effective” percentage is only an approximation. If you work in another country, the right figure will be different. When in doubt, use a conservative rate or ask a qualified tax professional.
Expenses belong in the annual expenses box: software, insurance (including health insurance if you pay it yourself), equipment, accounting, a studio or coworking desk, professional development, contractors, and similar costs. Do not put your desired salary in that box; that is the take-home field.
The results include an hourly rate, a 6-hour day rate and an 8-hour day rate, and a weekly figure based on your billable hours in a working week. A “day” of freelance work is often closer to five or six billable hours once meetings and context-switching are counted, which is why both day rates are shown.
Treat the result as a cost-based floor, not as a market price and not as a promise. Specialized work can command more; some markets will not bear the floor at all. Income is not guaranteed. This page does not collect your numbers, and it does not adjust for rush fees, project minimums, or unpaid discovery, all of which you may still want to add on top.