Freelance Hourly Rate Calculator
Employees get paid for every working hour — freelancers don't. This calculator turns your target income into a real billable rate that covers expenses, self-employment tax, vacation, and the hours you spend on admin and finding clients.
| Required gross revenue | — |
| Billable hours per year | — |
| Equivalent day rate (8h) | — |
Why freelancers must charge more than employees earn
A $70,000 salary is not the same as $70,000 of freelance revenue. Freelancers pay both halves of payroll tax, buy their own equipment and insurance, get no paid vacation, and spend a large share of their week on unbillable work — invoicing, proposals, marketing. The formula accounts for all of it:
Rate = (Target income ÷ (1 − Tax rate) + Expenses) ÷ Billable hours per year
The billable-percentage trap
New freelancers assume 40 billable hours per week. In practice, most bill 50–70% of their working time. At 60% billable, a 40-hour week yields only 24 paid hours. Underestimating this is the single most common reason freelancers undercharge.
Worked example
Target $70,000 take-home, $6,000 expenses, 30% tax, 4 weeks off, 40-hour weeks, 60% billable:
- Required gross: $70,000 ÷ 0.70 + $6,000 = $106,000
- Billable hours: 48 weeks × 40h × 60% = 1,152 hours
- Minimum rate: $106,000 ÷ 1,152 ≈ $92/hour
That's why an employee earning $34/hour needs to charge $90+ as a freelancer to match their old standard of living.
Frequently asked questions
What hourly rate equals a $70,000 salary as a freelancer?
Typically $85–100 per hour. After self-employment tax, business expenses, unpaid time off, and unbillable hours, a freelancer needs roughly 2.5–3× the equivalent employee hourly rate.
What percentage of freelance time is billable?
Most established freelancers bill 50–70% of their working hours. The rest goes to finding clients, proposals, invoicing, and administration. New freelancers often bill even less.
What tax rate should I use?
US freelancers pay 15.3% self-employment tax on net earnings plus regular income tax. A combined 25–35% is a common planning estimate; ask an accountant for your actual situation.
Should I charge hourly or per project?
This calculator gives your floor either way. For project pricing, estimate the hours honestly, multiply by your minimum rate, then add margin for revisions and risk.
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Last updated: 2026-07-07