What to charge per hour to hit income goals. The Hourly Rate Calculator takes target annual income, annual business expenses, billable hours per week, working weeks per year and returns hourly rate to charge plus billable hours per year, equivalent day rate (8 billable hours). Results update as you type, and the formula is shown under the result so you can repeat it in your own spreadsheet.
Payroll figures should follow the rules in your contracts and local law. Where a rule differs between states or countries, adjust the inputs; the calculator shows its assumptions so you can check them against your own policy. Use the worked example below to check the maths against your own figures.
How the Hourly Rate Calculator works
Freelancers rarely bill more than 25–30 hours a week once selling, admin and holidays are counted, which is why the rate has to be well above the hourly equivalent of an employee salary.
Worked example
With the example values (target annual income of $90,000, annual business expenses of $8,000, billable hours per week of 25 hours, working weeks per year of 46), the hourly rate to charge is $85.22; billable hours per year 1,150.0 hours, equivalent day rate (8 billable hours) $681.74. Change any figure above and the result updates immediately; use Copy results to paste the summary into a note or email.
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Frequently Asked Questions
How is hourly rate to charge calculated?
hourly rate = (target income + expenses) ÷ (billable hours per week × working weeks).
Which figures do I need?
Target annual income, annual business expenses, billable hours per week, working weeks per year. Take them from the same period and the same set of accounts or reports so the ratio is consistent, and check the example values as a guide to the units expected.
Do the rules differ by location?
Yes. Statutory rates, ceilings and eligibility conditions vary by country and often by state. Adjust the inputs to your jurisdiction and confirm with your payroll provider or labour law adviser.
