Freelancer Hourly Rate Calculator
Find the hourly rate you need to charge to hit your target income after taxes, expenses, time off, and non-billable hours.
What you want to take home after taxes
Software, equipment, insurance, etc.
Income + self-employment tax
% of work hours that are billable to clients
Why Most Freelancers Undercharge
The most common mistake is dividing your target salary by 2,080 hours (52 weeks × 40 hours). This ignores three critical factors that make freelancing more expensive than employment: self-employment taxes (an extra 15.3% in the US), unpaid time off (no PTO, sick leave, or holidays), and non-billable hours (admin, sales, invoicing, marketing). After accounting for all three, most freelancers need to charge 40–60% more than the equivalent salaried hourly rate.
Understanding Billable Percentage
Billable percentage is the share of your working hours that you actually bill clients for. The rest goes to finding clients, writing proposals, invoicing, bookkeeping, learning, marketing, and admin. New freelancers often land at 50–60% billable. Experienced freelancers with repeat clients can hit 75–80%. Agency owners with dedicated admin support might reach 85%+.
If you currently spend Monday mornings on admin and Friday afternoons on marketing, that's already ~12% of your week non-billable. Add sales calls, proposal writing, and professional development, and 70% billable is realistic for most solo freelancers.
Hourly vs. Project-Based Pricing
This calculator gives you the minimum hourly rate to cover your costs. But the best freelancers use project-based or value-based pricing once they know their floor rate. Benefits of project pricing:
- Clients prefer cost certainty — they know the total upfront
- You're rewarded for being efficient, not punished for being fast
- Effective hourly rate can exceed your base rate by 2–3x on well-scoped projects
- Easier to raise prices over time without the "per hour" anchor
Use this calculator to set your floor, then price projects based on the value you deliver — not the hours you spend. Check our hourly to salary calculator to see what your freelance rate would look like as an equivalent salary.
Frequently Asked Questions
What tax rate should I use?
In the US, freelancers pay income tax plus self-employment tax (15.3% for Social Security and Medicare). A combined rate of 25–35% is typical depending on your income bracket and state. If you're outside the US, use your marginal tax rate plus any national insurance or VAT obligations you need to cover from your rate.
What counts as a business expense?
Common freelancer expenses include: software subscriptions ($200–500/mo), health insurance ($300–800/mo), retirement contributions, professional development, hardware/equipment, coworking space or home office costs, accounting/legal services, liability insurance, and marketing spend. These are pre-tax deductions that reduce your taxable income.
How do I know if my rate is competitive?
Research rates on platforms like Glassdoor (for equivalent salaried roles, then add 40–60%), Upwork (for freelance market rates), and industry salary surveys. Your rate should also factor in your specialization, years of experience, and the value of your niche. Specialists in high-demand fields (AI/ML, security, medical) can command 2–5x generalist rates.
Should I charge different rates for different clients?
Yes — rate segmentation is standard practice. Enterprise clients with larger budgets and longer timelines can support premium rates. Startups and small businesses may get a lower rate in exchange for equity, testimonials, or portfolio pieces. Rush work, weekend work, and scope creep should always be billed at a premium (typically 1.5–2x your base rate).
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