Most rate calculators just divide your salary by 2,080 hours. This one factors in taxes, business expenses, unpaid admin time and time off — so the number it gives you is one you can live on.
Work out the hourly rate you actually need — after taxes, expenses, unpaid admin time and time off.
Turn your new rate into a clean, professional invoice in under a minute.
Create a free invoice →Estimates only — not tax or financial advice. Verify with a qualified professional.
Most rate calculators just divide the salary you want by 2,080 hours and call it a day. That number is almost always too low, because it ignores the parts of freelancing that quietly eat your income: taxes, business costs, unpaid admin time, and the weeks you take off. This calculator builds all four back in, so the rate it gives you is one you can actually live on.
Here is the formula in plain English:
The result is a floor, not a ceiling. It is the least you can charge without losing money. Your market, experience and the value you deliver can push it much higher — which is why the tool also shows a rate with a 15% buffer for slow periods and scope creep.
This tool is built for anyone who invoices by the hour or day and is responsible for their own taxes and downtime, including:
It works for any currency and any country — just enter your own estimated tax rate. If you are unsure of that number and you file in the US, our free Self-Employment Tax Calculator works it out properly from your profit and filing status, so you can enter a calculated figure here instead of a guess. Outside the US, a qualified accountant or your local tax authority can confirm it.
Maria wants to keep $60,000 a year after tax. She spends about $6,000 on software and gear, estimates a combined 25% tax rate, and reckons a quarter of her time goes to admin and sales. She works 5 days a week, 8 hours a day, and wants 20 days of vacation plus 12 days for holidays and the odd sick day.
Her day rate lands near $503, and with a 15% buffer she would quote closer to $72 per hour. The naive "salary ÷ 2,080" method would have told her $29 — less than half of what she actually needs.
James wants $110,000 after tax, spends $9,000 on business costs, estimates a 30% tax rate, and keeps non-billable time to 20% because he has steady retainer clients. He works 5 days a week, 7 billable hours a day, with 25 vacation days and 10 holiday/sick days.
That is his break-even floor. Given his experience, he would likely position well above it — the calculator simply makes sure he never quotes below the line where he starts losing money.
There is no single right number — it depends on the take-home pay you want, your expenses, your tax rate and how many hours you can realistically bill. The calculator gives you a personalized minimum: the least you can charge and still hit your income goal. From there, adjust upward based on your experience, niche and the value you deliver.
An employee's salary quietly includes paid vacation, employer tax contributions, benefits and zero unpaid admin time. As a freelancer you cover all of that yourself, and you can only bill a fraction of your working hours. Once taxes, expenses, time off and non-billable work are added back, the true rate is usually far higher than salary ÷ 2,080.
Enter your best estimate of income tax plus self-employment or payroll tax combined, as a percentage of profit. Many freelancers land somewhere between 20% and 35% depending on income and location. If you file in the US, our free Self-Employment Tax Calculator will compute this percentage for you so you do not have to guess. This tool provides estimates only and is not tax advice — confirm your actual rate with a qualified accountant or your local tax authority.
Any working time you cannot invoice: prospecting and pitching, contracts and admin, bookkeeping, email, marketing, and professional development. For most freelancers this is 20–40% of the working week. Underestimating it is the most common reason a rate turns out too low.
Use this hourly figure as your baseline either way. For project quotes, estimate the hours involved, multiply by your rate, then add a buffer for revisions and scope creep. Value-based pricing can go higher still, but the hourly floor tells you when a project quote has dropped below profitability.
Yes — it is completely free, with no sign-up required to see your rate. You can optionally have the full breakdown emailed to you if you want a copy to reference or share with clients.
This guide is for general information only and does not constitute tax, legal or financial advice. Figures are estimates; consult a qualified professional for your specific situation.