Freelance Hourly Rate Calculator

About this calculator

A freelance hourly rate is not simply your desired salary divided by 2,080 work hours a year — it has to absorb the hours you cannot bill (marketing, admin, sick days), business expenses, and taxes that an employer would otherwise cover. The formula works backward from a target annual income: divide it by your realistic billable hours per year (often only 50-70% of total working hours after non-billable time is subtracted), then add a markup for overhead and self-employment tax.

Freelance writers, designers, developers and consultants use this calculation when setting a day rate or hourly quote, especially when moving from a salaried job and trying to figure out what hourly number replaces a former salary plus benefits. Ignoring non-billable time is the most common pricing mistake — someone billable only 25 hours a week out of 40 needs a materially higher hourly rate than the naive salary-divided-by-hours math suggests.

This calculator takes your target income, expected billable hours and annual business expenses and returns the hourly rate you need to charge to hit that target.