Your numbers
How the formula works
Start with what you want to keep, add business costs, then gross it up for taxes. Divide by the hours you can actually bill.
rate = (take-home + expenses) / (1 - tax%) / ((52 - weeks off) x billable hours)
Worked example
Take-home $90,000 plus $6,000 expenses is $96,000. At a 28% set-aside, gross revenue needed is $96,000 ÷ 0.72 = $133,333. Billable hours are (52 − 5) × 25 = 1,175. The minimum rate is $133,333 ÷ 1,175 = $113 per hour.
Related tools
Self-employment tax set-aside calculator · Retainer pricing calculator · Why your freelance rate is too low
Frequently asked questions
What is a good hourly rate for a freelancer?
It depends on your costs, taxes and billable time, not on a single market number. Use the calculator: enter the take-home you want, your business expenses, a tax set-aside and your real billable hours. The result is the minimum rate that meets those targets.
Why do I divide by billable hours, not 40 hours a week?
Freelancers spend time on sales, admin, learning and unpaid gaps. Only billable hours earn money, so the rate has to cover the whole year of work in fewer paid hours.
How many billable hours per week is realistic?
Many freelancers find 20 to 30 billable hours a week realistic once sales and admin are counted. Track your own time for a month and use your real number.
Should I charge more than the minimum rate?
Yes. The result is a floor that only covers your targets. Add margin for demand, specialty, risk and slow months.