Handyman Hourly Rate Calculator

Determine the hourly rate you need to charge to cover your business expenses, taxes, and achieve your desired take-home income. Stop guessing and start pricing for profit.

Desired Annual Net Income ($)

Your target take-home pay after business expenses and taxes.

Annual Overhead Expenses ($)

Total yearly costs: insurance, tools, vehicle, phone, marketing, etc.

Annual Billable Hours

Hours actually working on paying jobs (e.g., 40 hrs/week * 50 weeks = 2000 total, but perhaps only 1500 are billable).

Estimated Tax Rate (%)

Income and self-employment taxes.

Target Profit Margin (%)

Extra percentage for business growth.

function calculateHandymanRate() { var desiredNetIncome = parseFloat(document.getElementById('desiredNetIncome').value); var annualOverhead = parseFloat(document.getElementById('annualOverhead').value); var billableHours = parseFloat(document.getElementById('billableHours').value); var taxRate = parseFloat(document.getElementById('taxRate').value); var profitMargin = parseFloat(document.getElementById('profitMargin').value); var resultDiv = document.getElementById('rateResult'); resultDiv.style.display = 'block'; if (isNaN(desiredNetIncome) || isNaN(annualOverhead) || isNaN(billableHours) || isNaN(taxRate) || isNaN(profitMargin) || billableHours <= 0 || desiredNetIncome < 0 || annualOverhead = 1) { grossIncomeNeededForSalary = desiredNetIncome * 2; // Fallback for extreme inputs to prevent divide by zero or negative } else { grossIncomeNeededForSalary = desiredNetIncome / (1 – taxDecimal); } // 2. Calculate Total Revenue required to cover Gross Salary + Overhead var totalRevenueTargetBase = grossIncomeNeededForSalary + annualOverhead; // 3. Apply Profit Margin to the total revenue target base var totalGrossRevenueTarget = totalRevenueTargetBase * (1 + profitDecimal); // 4. Calculate Final Hourly Rate var hourlyRate = totalGrossRevenueTarget / billableHours; // Calculations for breakdown var estimatedTaxes = grossIncomeNeededForSalary – desiredNetIncome; var weeklyBillable = billableHours / 52; var dailyGrossTarget = totalGrossRevenueTarget / (52 * 5); // Assuming 5 day weeks for average resultDiv.innerHTML = "

Recommended Minimum Hourly Rate: $" + hourlyRate.toFixed(2) + "

" + "To achieve a net income of $" + desiredNetIncome.toLocaleString() + ", your business needs to generate a total gross annual revenue of approximately $" + totalGrossRevenueTarget.toLocaleString(undefined, {maximumFractionDigits:0}) + "." + "

" + "

Breakdown of Your Rate:

" + "

Billable Time: This rate assumes you are actively billing for approx. " + weeklyBillable.toFixed(1) + " hours per week.
Expense Coverage: This rate covers your $" + annualOverhead.toLocaleString() + " in annual overhead.
Estimated Taxes: Approx. $" + estimatedTaxes.toLocaleString(undefined, {maximumFractionDigits:0}) + " of your revenue will go towards taxes (at " + taxRate + "%).
Profit & Growth: Includes a " + profitMargin + "% margin for business reinvestment or savings.

" + "Note: This is your base charging rate. You may adjust higher for specialized skills, emergency calls, or specific market demands."; }

Understanding Your Handyman Hourly Rate

One of the biggest challenges for independent handymen and small service business owners is determining the right price for their services. Charging too little leads to burnout and financial struggle, while charging too much can drive away potential customers. A sustainable hourly rate isn't just picking a number out of thin air; it's a calculation based on your real financial needs and business costs.

This calculator helps you build a rate from the ground up, ensuring that every hour you work contributes not just to your salary, but also to covering your expenses, taxes, and future business growth.

Key Factors Determining Your Rate

Desired Net Income: This is your "take-home pay." It's the amount of money you want left in your pocket after all business expenses are paid and taxes are set aside. This should cover your personal living expenses and personal savings goals.
Annual Overhead Expenses: These are the costs of keeping your business open, regardless of how many jobs you do. It is crucial to be realistic here. Common overhead costs include liability insurance, vehicle payments, fuel, tool maintenance and replacement, phone bills, accounting fees, licensing, and marketing costs.
Billable vs. Non-Billable Hours: This is a critical distinction. You might work 40 hours a week, but you cannot bill a client for the time spent driving between jobs, creating estimates, buying supplies at the hardware store, or doing bookkeeping. If you work 2,000 hours a year but only 1,500 are "wrench time" on paying jobs, your hourly rate must be higher to compensate for the 500 non-billable hours.
Taxes: As a self-employed individual, you are responsible for both income tax and self-employment tax (Social Security and Medicare). Failing to account for this is a common cause of failure for new businesses. A safe estimate often ranges between 20% and 30% of your gross income, depending on your location and bracket.
Profit Margin: A business should do more than just pay its owner a wage and cover costs; it should generate profit. Profit is the money left over that can be reinvested into the business for better equipment, expansion, or kept as a rainy-day fund. Adding a 10-20% profit margin on top of your costs ensures long-term viability.

Example Scenario

Let's look at the default values in the calculator. A handyman wants a take-home net salary of $60,000 per year. They estimate their business overhead (insurance, van, tools) at $15,000 annually. They plan to work full time but estimate they will only clock about 1,600 actual billable hours per year. They expect an effective tax rate of 25% and want to build in a 10% profit margin for growth.

To achieve that $60,000 net income, they actually need to generate $80,000 before taxes. Adding the $15,000 overhead means the business costs $95,000 to run. Adding a 10% profit margin pushes the total gross revenue target to $104,500. Dividing that total target by 1,600 billable hours results in a necessary hourly charge of approximately $65.31.