Free tool
Freelance hourly rate calculator
Start from the income you need and work backwards to the rate that produces it, using the hours somebody will actually pay for rather than the hours you sit at a desk.
Runs entirely in your browser. No account, nothing uploaded, works offline.
In short
To calculate a freelance hourly rate, add your target annual income to your annual business costs, then divide by your billable hours: working weeks multiplied by weekly hours multiplied by your billable percentage. Dividing by 2,080 instead assumes fifty-two paid weeks and 100% billable time, which produces a rate roughly a third too low.
The mistake this calculator exists to fix
The usual way people set a freelance rate is to take the salary they want and divide by 2,080, the number of hours in a fifty-two week year at forty hours a week. It is a comforting calculation and it produces a rate that is roughly a third too low.
Two things are wrong with it. You do not work fifty-two weeks, because nobody pays you to take a holiday. And you do not bill every hour you work, because a meaningful share of your week is proposals, invoicing, chasing payment, admin, marketing and learning, none of which appear on any invoice.
Divide by the hours somebody will actually pay for and the answer changes substantially. With the defaults on this page, the naive method gives $53.80 an hour and the corrected one gives $82.78.
What is deliberately not in here
Tax. It depends on your country, your business structure and your band. Any calculator that models it is guessing, and a wrong number stated confidently is worse than no number. Treat the income input as pre-tax business income.
Profit and reinvestment. If you want the business to fund its own growth rather than paying out everything it earns, add that to the income target rather than hoping it appears.
Non-payment and scope creep. Every independent business has some. If you want to price for it, the honest way is to raise the income target rather than to inflate the hours.
Your billable percentage is a measurement, not a guess
The billable share is the input that moves the answer most, and it is the one people are least sure about. Assume 80 when the truth is 60 and your rate comes out a quarter short, permanently.
The billable hours calculator works it out from a week you describe. An automatic time tracker works it out from a week you actually had, which is the version worth pricing against.
Questions
How do I calculate my freelance hourly rate?
Add the annual income you want to the business costs you have to cover, then divide by the hours a client will actually pay for. That last figure is not your working hours: it is your working hours multiplied by your billable percentage, which for most independent workers sits well below 100.
Why is dividing my target salary by 2,080 hours wrong?
Because 2,080 assumes fifty-two paid weeks of forty billable hours. As a freelancer you take unpaid holiday, and a large share of your working hours goes on proposals, admin, invoicing and marketing that nobody pays for. Using the full figure produces a rate roughly a third too low.
What business expenses should I include?
Anything you pay for that an employer would otherwise have covered: software subscriptions, hardware, insurance, an accountant, workspace, professional development, and any equipment you replace on a cycle. It is usually more than people expect when they add it up.
Does this include tax?
No, deliberately. Tax depends on your country, your business structure and your income band, and a calculator that guesses produces a confident figure that is wrong for almost everybody. Treat the income input as pre-tax business income and take the number to an accountant who knows your situation.
What billable percentage should I assume?
If you do not know yours, measure it rather than guessing, because guesses here are usually optimistic. As a starting point, treat anything above about 75 as a claim you should check, since it leaves very little room for the proposals, invoicing and admin that every independent business has.
Should I charge hourly or by the project?
The rate this produces is useful either way. For project pricing it is what you check your quote against: estimate the hours, multiply, and see whether the number you were about to propose covers it.