Hourly Rate Calculator
Work out the hourly rate a freelancer needs to charge to hit a target annual income.
Last updated · View algorithm, constants and default inputs (JSON)
About this calculator
Set a desired after-tax annual income, annual business costs, the effective tax rate you want to model, working hours and billable share. This simplified model estimates required revenue as business costs + target take-home ÷ (1 − effective tax rate). It assumes one flat effective rate and deductible business costs; actual taxes, social contributions and local rules vary.
Worked example
calculated with the default values below
Target annual take-home income (after tax) 80,000 $ · Annual business costs 12,000 $ · Weeks worked per year 46 · Hours worked per week 40 h · Share of hours that are billable 60 % · Estimated effective tax rate 25 % Required hourly rate 107.49 $ · Pre-tax profit needed 106,667 $ · Required annual revenue 118,667 $ · Billable hours per year 1,104 h · Equivalent day rate (8 h) 859.90 $ · Equivalent monthly revenue 9,889 $
General background references
Disclaimer
These calculators give general date results. Public holidays, working-day conventions and time-zone rules are set locally and change, so confirm against the official calendar for anything legally or contractually binding.
Implementation source
This record describes the implementation used by this page. It is not independent validation. External references, when available, support only the stated formula or definition; estimates and custom rules retain their own assumptions.
Formula and variables
G = N ÷ (1 − t) ; R = G + C ; H = w × h × (b ÷ 100) ; rate = R ÷ H
- N
- target take-home income
- t
- effective tax rate (%)
- C
- annual business costs
- w
- weeks worked/year
- h
- hours/week
- b
- billable share (%)
- R
- required annual revenue
Assumes one flat effective tax rate applied to target take-home income and that business costs are deductible before tax. This is a pricing scenario, not tax advice; progressive taxes, social contributions and local rules are not modeled.
Frequently asked questions
Is the income target before or after tax?
Enter the annual take-home amount you want after tax. The model grosses it up using one effective tax-rate assumption, then adds business costs to estimate revenue needed. Real tax systems may be progressive, and social contributions or deductions vary; this is not tax advice.