Does this include federal or state income tax?

No — only the 15.3% self-employment tax is grossed up.

What counts as a 'non-billable' hour?

Admin, bookkeeping, marketing, sending proposals, professional development, and unpaid discovery calls.

Why does the calculator cap weeks off at 52?

There are only 52 weeks in a year.

What if my net profit is very high — does the self-employment tax rate change?

Yes. Above the Social Security wage base, the 12.4% portion stops applying to the excess, so this calculator's linear formula slightly overstates the required rate at that income level.

Is 60% a realistic billable-hours percentage?

It's within the commonly cited 50-70% range for solo freelancers, but it varies a lot by field and business stage.

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Freelancer Hourly Rate Calculator

The hourly rate you need to charge to hit a take-home target, after self-employment tax and non-billable hours.

🔒 Runs entirely in your browser — nothing here is ever uploaded

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Last reviewed 2026-08-30

About the Freelancer Hourly Rate Calculator

Calculates the hourly rate a freelancer or independent contractor needs to charge to hit a target annual take-home, after grossing up for self-employment tax, business expenses, unpaid time off, and non-billable hours.

100% Free Runs in Your Browser No Sign-Up Required

How to use it

Enter your desired annual take-home pay (after self-employment tax, before income tax).
Enter your expected annual business expenses.
Enter weeks off per year and hours worked per week.
Enter what % of your working hours are actually billable to clients.
Read your required hourly rate and the full revenue breakdown.

Formula

Net profit needed = desired take-home ÷ (1 − 14.1296%), where 14.1296% = 92.35% (Schedule SE factor) × 15.3% (combined self-employment tax rate). Self-employment tax = net profit needed − desired take-home. Required revenue = net profit needed + annual business expenses. Available hours = (52 − weeks off) × hours per week. Billable hours = available hours × billable %. Hourly rate = required revenue ÷ billable hours.

Worked example

A freelancer wanting $80,000 take-home, with $8,000 in annual expenses, 4 weeks off, 40-hour weeks, and 60% billable hours: net profit needed is $93,163.87 (of which $13,163.87 is self-employment tax), required revenue is $101,163.87 — for a required hourly rate of $87.81.

Required hourly rate by billable-hours % ($80,000 take-home example, 4 weeks off, 40hr weeks)

Required hourly rate by billable-hours % ($80,000 take-home example, 4 weeks off, 40hr weeks)
Billable %	Required hourly rate
40%	$131.72
50%	$105.38
60%	$87.81 (tool's own example)
70%	$75.27
80%	$65.86

Interpreting your result

Grosses up only for the 15.3% self-employment tax — federal and state income tax are not included, so the take-home figure is pre-income-tax. The formula is linear and exact only while net profit stays under the 2026 Social Security wage base (~$199,784); above that it slightly overstates the required rate. The 50-70% billable-hours range commonly cited for solo freelancers is an industry rule of thumb, not a guarantee.

Recommendations

• Raising your billable-hours % is usually more powerful than raising your rate — going from 50% to 65% billable cuts your required rate by roughly a quarter.
• Business expenses are added on top of (not netted against) your take-home target.
• Track your own actual billable percentage after a few months — the 50-70% industry range is a starting assumption.

Frequently asked questions

A W-2 salary already has half of FICA paid by your employer and doesn't need to cover unpaid time off or non-billable hours.