Please enter valid positive numbers for all fields.
Gross Annual Revenue Needed:–
Total Billable Hours/Year:–
Required Hourly Rate:–
function calculateRate() {
// Get input values
var targetIncome = parseFloat(document.getElementById('targetIncome').value);
var annualExpenses = parseFloat(document.getElementById('annualExpenses').value);
var taxRate = parseFloat(document.getElementById('taxRate').value);
var billableHours = parseFloat(document.getElementById('billableHours').value);
var weeksOff = parseFloat(document.getElementById('weeksOff').value);
var errorDisplay = document.getElementById('errorDisplay');
var resultsBox = document.getElementById('results');
// Reset display
errorDisplay.style.display = 'none';
resultsBox.style.display = 'none';
// Validation
if (isNaN(targetIncome) || isNaN(annualExpenses) || isNaN(taxRate) || isNaN(billableHours) || isNaN(weeksOff)) {
errorDisplay.innerText = "Please fill in all fields with valid numbers.";
errorDisplay.style.display = 'block';
return;
}
if (billableHours = 52) {
errorDisplay.innerText = "Please check your hours and weeks off inputs.";
errorDisplay.style.display = 'block';
return;
}
// Logic
// 1. Calculate Gross Revenue needed to cover Taxes.
// Formula: (Net + Expenses) / (1 – TaxRateDecimal)
// Note: Expenses are usually deductible, but for simplicity in a basic rate calc, we often treat them as costs needed *before* net profit.
// However, strictly speaking, you pay taxes on (Revenue – Expenses).
// Let's use the standard freelance formula: Revenue = (Net Target) / (1 – TaxRate) + Expenses.
// Wait, if I earn R and spend E, I am taxed on (R-E).
// Net = (R-E) – TaxOn(R-E)
// Net = (R-E) * (1 – TaxRate)
// Net / (1 – TaxRate) = R – E
// R = [Net / (1 – TaxRate)] + E
var taxDecimal = taxRate / 100;
var grossRevenueNeeded = (targetIncome / (1 – taxDecimal)) + annualExpenses;
// 2. Calculate Total Billable Hours per Year
var workingWeeks = 52 – weeksOff;
var totalBillableHours = workingWeeks * billableHours;
// 3. Calculate Hourly Rate
var hourlyRate = grossRevenueNeeded / totalBillableHours;
// Display Results
document.getElementById('grossRevenueResult').innerText = "$" + grossRevenueNeeded.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('totalHoursResult').innerText = totalBillableHours.toLocaleString('en-US');
document.getElementById('hourlyRateResult').innerText = "$" + hourlyRate.toLocaleString('en-US', {minimumFractionDigits: 2, maximumFractionDigits: 2});
resultsBox.style.display = 'block';
}
How to Calculate Your Freelance Hourly Rate
Setting the right hourly rate is one of the most critical decisions you will make as a freelancer. If you price yourself too low, you risk burnout and financial instability. Price yourself too high without justification, and you may struggle to attract clients. This Freelance Hourly Rate Calculator helps you determine a sustainable rate based on your financial goals and business realities.
Understanding the Formula
Unlike a traditional salary, a freelance rate must cover not just your take-home pay, but also your taxes, business expenses, and unbillable time. Here is the logic used in our calculator:
Target Net Income: This is the "take-home" pay you want in your bank account after all obligations are met.
Business Expenses: Freelancers must pay for their own hardware, software subscriptions, office space, internet, and health insurance. These costs must be added on top of your desired salary.
Taxes: As a freelancer, you are often responsible for both the employer and employee portion of taxes (self-employment tax). This significantly impacts your gross revenue requirements.
Billable Hours: You cannot bill for 40 hours a week, 52 weeks a year. You must account for time spent on marketing, administration, and time off for vacations or sickness.
Billable vs. Non-Billable Hours
A common mistake for new freelancers is assuming they will be billable 100% of the time. In reality, a healthy freelance business often sees a 60/40 or 70/30 split between billable work and administrative tasks. Administrative tasks include:
Invoicing and bookkeeping
Client acquisition and pitching
Skill development and training
Email and project management
If you plan to work a standard 40-hour week, it is safer to input 20 to 25 billable hours into the calculator to ensure your rate covers the time you spend running the business.
Why You Should Factor in Time Off
Employees get paid vacation and sick days; freelancers do not. If you do not factor weeks off into your annual calculation, you are effectively taking a pay cut every time you take a vacation or get the flu. By reducing your total working weeks (e.g., from 52 to 48), the calculator adjusts your hourly rate upward so you earn enough during your working weeks to cover your time off.