Includes vacation, public holidays, and sick leave.
%
Time spent on admin, marketing, and sales (unpaid).
Your Required Rates
Minimum Daily Rate$0.00
Minimum Hourly Rate (8h)$0.00
Total Revenue Needed (Gross)$0.00
Work Breakdown
Total Potential Work Days0
Actual Billable Days0
*Note: The 'Gross Revenue Needed' accounts for your expenses and taxes to ensure you hit your net target income. The 'Actual Billable Days' removes your time off and non-billable admin time.
How to Calculate Your Daily Rate as a Freelancer
Determining the correct daily rate is one of the most challenging aspects of transitioning from full-time employment to freelancing or contracting. Unlike a salary, your daily rate must cover not just your income, but also your taxes, overhead costs, and unbillable time.
The Daily Rate Formula
The core logic behind calculating your daily rate is simple: divide your total required annual revenue by the actual number of days you can bill a client. However, getting the inputs right is where most people make mistakes.
Daily Rate = (Target Net Salary + Expenses + Taxes) / Billable Days
Key Components of the Calculation
1. Target Net Income
This is the amount of money you want to take home after all business expenses and taxes are paid. This should be comparable to the take-home pay of a full-time role, plus a premium for the risk associated with freelancing (often 20-30% higher).
2. Business Expenses (Overheads)
Freelancers incur costs that employees do not. You must factor in:
Hardware and software subscriptions (Adobe, Office, Hosting)
Professional insurance (Liability, Indemnity)
Coworking space or home office costs
Accounting and legal fees
Marketing and website maintenance
3. The "Billable Days" Trap
A common error is dividing your target income by 260 (the standard number of working days in a year). You cannot bill 260 days. You need to subtract:
Weekends: 104 days
Vacation: 15–25 days
Public Holidays: ~10 days
Sick Leave: ~5 days
Furthermore, you must account for non-billable time. This is time spent invoicing, finding new clients, updating your portfolio, or learning new skills. A safe rule of thumb is that 20% to 30% of your working time is non-billable.
Hourly vs. Daily Rate
While this calculator provides an hourly breakdown based on an 8-hour day, billing by the day is often advantageous for senior freelancers. It moves the focus from "clock-watching" to value delivery and simplifies administrative tracking. If you do bill hourly, ensure your rate is high enough to cover the inefficiency of switching contexts between multiple smaller clients.
Tax Considerations
This calculator uses a simplified tax model (Gross Revenue / (1 – Tax Rate)) to ensure you have enough gross revenue to cover the taxes on that revenue. Always consult with a qualified accountant to understand the specific tax brackets and deductions available in your jurisdiction.
function calculateDailyRate() {
// Get inputs
var targetNetSalary = parseFloat(document.getElementById('targetSalary').value) || 0;
var annualExpenses = parseFloat(document.getElementById('annualExpenses').value) || 0;
var taxRate = parseFloat(document.getElementById('taxRate').value) || 0;
var daysPerWeek = parseFloat(document.getElementById('daysPerWeek').value) || 5;
var daysOff = parseFloat(document.getElementById('daysOff').value) || 0;
var unbillablePercent = parseFloat(document.getElementById('unbillablePercent').value) || 0;
// 1. Calculate Total Gross Revenue Needed
// Logic: Gross Revenue – Expenses – TaxOnGross = NetSalary
// Simplified approximation:
// (NetSalary + Expenses) / (1 – TaxRate/100)
// Note: Taxes are usually calculated on Profit (Revenue – Expenses).
// Better Logic:
// Profit Needed Before Tax = TargetNetSalary / (1 – TaxRate/100)
// Total Gross Revenue = Profit Needed Before Tax + Annual Expenses
var profitNeededBeforeTax = 0;
if (taxRate < 100) {
profitNeededBeforeTax = targetNetSalary / (1 – (taxRate / 100));
} else {
profitNeededBeforeTax = targetNetSalary; // Avoid division by zero or negative
}
var totalGrossRevenue = profitNeededBeforeTax + annualExpenses;
// 2. Calculate Billable Days
var weeksInYear = 52;
var totalWorkingDays = (weeksInYear * daysPerWeek) – daysOff;
if (totalWorkingDays < 0) totalWorkingDays = 0;
// Remove non-billable percentage
var billableDays = totalWorkingDays * (1 – (unbillablePercent / 100));
// Avoid division by zero
if (billableDays <= 0) {
document.getElementById('resultDailyRate').innerText = "Check Inputs";
document.getElementById('resultHourlyRate').innerText = "-";
document.getElementById('resultGrossRevenue').innerText = "-";
document.getElementById('resultTotalDays').innerText = "0";
document.getElementById('resultBillableDays').innerText = "0";
return;
}
// 3. Calculate Rates
var dailyRate = totalGrossRevenue / billableDays;
var hourlyRate = dailyRate / 8; // Assuming 8 hour standard day
// 4. Update UI
// Format currency
var formatter = new Intl.NumberFormat('en-US', {
style: 'currency',
currency: 'USD',
});
document.getElementById('resultDailyRate').innerText = formatter.format(dailyRate);
document.getElementById('resultHourlyRate').innerText = formatter.format(hourlyRate);
document.getElementById('resultGrossRevenue').innerText = formatter.format(totalGrossRevenue);
// Format numbers
document.getElementById('resultTotalDays').innerText = totalWorkingDays.toFixed(1);
document.getElementById('resultBillableDays').innerText = billableDays.toFixed(1);
}
// Initialize calculation on load
window.onload = calculateDailyRate;