What you want after taxes and expenses
Hours actually billed to clients (not total work time)
Software, coworking, equipment, and other recurring costs
Enter your numbers to see your rates
Why most freelance rate calculators get it wrong
The standard approach — divide your annual income goal by 2,080 hours — produces a number that looks reasonable but fails miserably in practice. It ignores two things that matter most: self-employment taxes and non-billable time. Freelancers typically spend 20 to 40 percent of their working hours on proposals, admin, invoicing, and business development. None of that time is billed to a client. And unlike a salaried employee, a freelancer owes self-employment tax on top of income tax — an additional 14 to 15 percent in the US alone.
This calculator works backwards from your take-home goal. You enter what you want to keep, and it calculates what you need to charge — after accounting for taxes, expenses, vacation, and realistic billable capacity.
The three rates
🚨 Minimum Acceptable Rate (MAR). Your floor. Calculated at 75 percent of your full income goal, this is the rate that keeps you financially stable with no margin for growth. Use it as your hard limit on tough client negotiations — not your opening offer.
🎯 Target Rate. Your standard quote. This covers your full income goal, self-employment taxes, and business expenses, divided by the billable hours you realistically work each year.
🚀 Premium Rate. Twenty-five percent above your target. Quote this for rush projects, high-complexity work, or when you are fully booked and a new client needs to displace existing work.
How the calculation works
For example, a US-based designer who wants $6,000 per month take-home, works 5 billable hours per day, takes 4 vacation weeks, and spends $400 per month on software and tools would need a target rate of approximately $86 per hour — not the $43 per hour a simple income-division would suggest.
How to use this calculator
Select your market. Choose US, UK, or Canada. The calculator auto-fills the effective self-employment tax rate for that country — 27 percent for the US, 30 percent for the UK, and 26 percent for Canada.
Enter your monthly take-home goal. This is the amount you want after taxes and expenses — what actually lands in your bank account.
Set your time off and billable hours. The vacation weeks slider defaults to 4 weeks. The billable hours slider defaults to 5 hours per day, which reflects realistic freelance patterns. Adjust both to match your actual schedule.
Add monthly business expenses. Include software subscriptions, coworking, equipment depreciation, and any recurring costs you pay to run your business.
Once you calculate, the Value Breakdown card shows exactly where each billed dollar goes: take-home, taxes, and business costs. Read it before your next client call. Your rate is not arbitrary — it is the cost of running a professional freelance business. You can also find more detail on tax obligations for each market in our Self-Employment Tax Calculator.