Calculate your rate
How to set your freelance rate
Start with the income you want to take home, add the cost of benefits an employer would normally provide, gross it up for taxes and add business expenses. Divide that revenue target by the hours you can realistically bill.
Hourly rate = ((income + benefits) ÷ (1 − tax rate) + expenses) × (1 + buffer) ÷ billable hours
Why billable hours matter
Freelancers spend time on marketing, invoicing, emails and learning that clients do not pay for. Many freelancers bill only 20 to 30 hours in a 40-hour week. Using total working hours instead of billable hours will leave your rate too low.
Hourly, day and project pricing
- Hourly: simple and flexible, but it rewards slow work.
- Day rate: good for on-site or full-day engagements.
- Project fee: rewards speed and expertise. Estimate the hours, multiply by your rate and add a margin for revisions.
Raising your rates
Review your rate every six to twelve months. A higher rate usually attracts better clients, and a 10% increase on new work is often accepted without pushback.
Frequently asked questions
How much should a freelancer charge per hour?
Enough to cover your take-home goal, taxes, expenses, benefits and unpaid time. The result depends on your numbers, so use the calculator rather than a market average as your starting floor.
What tax rate should I use?
Freelancers pay income tax plus self-employment tax, so a combined 25% to 35% is a common planning range in the US. Ask a tax professional for your situation.
Why do I need a profit buffer?
Work is rarely steady. A buffer covers slow months, late payments and unexpected costs without forcing you to lower your income goal.
Is a salary the same as a freelance rate?
No. A freelancer pays their own taxes, insurance, equipment and time off, so the rate must be well above an equivalent employee wage. Use the salary to hourly calculator to compare.