Freelance Day Rate Calculator Uk

UK Freelance Day Rate Calculator

Calculate your required daily charge to meet your annual financial goals in the UK.

The amount you want in your pocket after tax and business expenses.

Equipment, software, accountant fees, insurance, co-working space, etc.

Standard working year is ~260 days. Subtract bank holidays (8), annual leave (~25), sick days, and non-billable admin time.

A rough percentage to set aside for HMRC (Income Tax and National Insurance). Varies by earnings and structure (Sole Trader vs Ltd Co).

Your Required Day Rate:

£0.00

To achieve a gross annual turnover of: £0.00

function calculateDayRate() { var netSalaryInput = document.getElementById('desiredNetSalary').value; var businessCostsInput = document.getElementById('annualBusinessCosts').value; var billableDaysInput = document.getElementById('billableDays').value; var taxBufferInput = document.getElementById('taxBufferPercent').value; var netSalary = parseFloat(netSalaryInput); var businessCosts = parseFloat(businessCostsInput); var billableDays = parseFloat(billableDaysInput); var taxBuffer = parseFloat(taxBufferInput); if (isNaN(netSalary) || netSalary < 0 || isNaN(businessCosts) || businessCosts < 0 || isNaN(billableDays) || billableDays <= 0 || isNaN(taxBuffer) || taxBuffer = 100) { alert("Please enter valid positive numbers for all fields. Billable days must be greater than 0, and tax buffer must be less than 100%."); return; } // 1. Calculate total net money needed (salary + costs covering) var totalNetNeeded = netSalary + businessCosts; // 2. Calculate required gross turnover based on the tax buffer percentage // Formula: Gross = Net / (1 – TaxRateDecimal) var requiredGrossTurnover = totalNetNeeded / (1 – (taxBuffer / 100)); // 3. Calculate day rate var dayRate = requiredGrossTurnover / billableDays; // Formatting currency for UK output var formatter = new Intl.NumberFormat('en-GB', { style: 'currency', currency: 'GBP', minimumFractionDigits: 2 }); document.getElementById('dayRateOutput').innerHTML = formatter.format(dayRate); document.getElementById('grossTurnoverOutput').innerHTML = formatter.format(requiredGrossTurnover); document.getElementById('rateResult').style.display = 'block'; }

A Guide to Setting Your UK Freelance Day Rate

Setting your rates as a freelancer in the UK is one of the most challenging aspects of running your own business. Charge too little, and you risk burnout without enough financial reward to cover your costs and taxes. Charge too much without the experience to back it up, and you may struggle to secure clients.

This calculator is designed to help you work backward from your financial goals to determine a sustainable baseline day rate. It takes into account the unique financial pressures of UK self-employment, including hidden costs and the reality of non-billable time.

Understanding the Inputs

1. Desired Annual "Take-Home" Salary

This is the most critical number. How much money do you need (or want) in your personal bank account at the end of the year to live comfortably, save, and pay your mortgage or rent? Do not include business expenses or money destined for HMRC here; this is your pure net income goal.

2. Estimated Annual Business Costs

Many new freelancers underestimate their overheads. You are now responsible for costs an employer used to cover. This includes:

• Technology: Laptops, software subscriptions (Adobe, Microsoft Office, accounting software), hosting.
• Professional Services: Accountant fees, business insurance (Professional Indemnity, Public Liability).
• Workspace: Coworking memberships or a portion of household bills if working from home.
• Marketing & Training: Website costs, courses to upskill.

3. Estimated Billable Days Per Year

This is where most freelance calculations fail. There are 365 days in a year. Weekends remove 104 days. UK public holidays remove another 8. That leaves roughly 253 potential working days.

However, you cannot bill for every single working day. You must account for:

• Annual Leave: If you were employed, you'd likely get 25+ days off. You should factor this in.
• Sick Days: Allow a buffer for illness.
• Admin & Marketing: You spend significant time invoicing, chasing payments, finding new clients, and updating your portfolio. This is "unpaid" time.

A realistic number for many established freelancers is between 200 and 230 billable days per year.

4. Estimated Tax & NI Buffer (%)

As a UK freelancer, you are responsible for paying your own Income Tax and National Insurance contributions. The exact amount depends on whether you operate as a Sole Trader or a Limited Company, and your total earnings bracket.

While this calculator cannot replace an accountant, setting aside a percentage of every invoice is crucial. For many freelancers earning between £30k and £60k, setting aside 25% to 35% of gross income is a prudent buffer to ensure you have enough when Self-Assessment time arrives.

Example Calculation

Let's imagine Sarah, a freelance graphic designer in Manchester:

• She wants a net take-home salary of £40,000.
• Her business costs (software, insurance, accountant) are £6,000 a year.
• She plans to take 5 weeks holiday and allows for admin time, estimating 220 billable days.
• She sets a tax buffer of 30%.

To achieve £40k net after paying £6k costs and setting aside 30% for tax, she needs a gross annual turnover of roughly £65,714. Her required day rate would be approximately £298.70 per day.