Freelancer Hourly Rate Calculator

Enter your desired annual take-home income, your estimated annual business expenses, the number of vacation weeks and sick days you plan to take, and your estimated billable hours percentage. The calculator will determine the hourly rate you need to charge, your effective daily rate, and the monthly and annual revenue your business needs to generate.

Be honest with your inputs, especially the billable percentage. Most freelancers overestimate how many hours they can bill. A realistic estimate leads to a sustainable rate.

A freelancer rate calculator helps self-employed professionals determine the hourly rate they need to charge to achieve their income goals. Unlike salaried employees, freelancers must account for business expenses, self-employment taxes, unpaid time off, and the reality that not every working hour is billable to a client.

Setting your rate too low is one of the most common mistakes freelancers make. This calculator ensures your rate covers all costs and leaves you with the personal income you need to support your lifestyle and financial goals.

The freelancer rate formula is:

Hourly Rate = (Desired Income + Business Expenses) / Billable Hours Per Year

Where billable hours are calculated as:

Billable Hours = (52 − Vacation Weeks) × 5 − Sick Days) × 8 × (Billable % / 100)

• 52 = Weeks in a year
• 5 = Working days per week
• 8 = Hours per working day
• Billable % = Percentage of working hours that are client-billable

Example: A freelancer targeting $100,000 in personal income with $15,000 in annual business expenses, 3 weeks of vacation, 5 sick days, and 70% billable time needs to generate $115,000 in total revenue. With 237 working days and 70% billable time, they have approximately 1,327 billable hours per year, resulting in a required hourly rate of roughly $87 per hour.