Income · Free tool
Freelance rate calculator
Most freelancers pick a number that feels right, then quietly work themselves into the ground to hit it. Your rate isn't a vibe. It's the money you need divided by the hours you can really bill. Put your numbers in and find your floor.
Quick answer: your minimum hourly rate is your target take-home pay, plus business expenses, plus the taxes you'll owe, divided by the hours you can realistically bill, which is almost never 40 a week. Most freelancers bill 20 to 30. The tool below turns your numbers into a floor; charge above it for profit and slow seasons.
Your numbers
Your hourly floor
$90/hour
How this is worked out
This is a floor, not a ceiling. It's the minimum that covers your goal with nothing left over for profit, dry spells, or raises. Real-world rates sit above it.
The math, in plain terms
A freelance rate has to do three jobs at once: pay you, cover the cost of running the business, and pre-pay the taxes nobody is withholding for you. So the formula is simply everything you need to earn, divided by the hours you can sell:
rate = (take-home ÷ (1 − tax rate) + expenses) ÷ annual billable hours
The two numbers people get wrong are taxes and hours. On taxes, a freelancer owes self-employment tax of 15.3% (Social Security and Medicare) on top of income tax, because there's no employer splitting it with you. On hours, a 40-hour week is not 40 billable hours: subtract sales, admin, invoicing, and email and most full-timers bill 20 to 30. Plug a real billable number in and the rate stops being optimistic.
That's also why matching your old salary undershoots. A job quietly bundles payroll taxes, health insurance, paid leave, and a 401(k) match into the package. Price those back in and freelancers generally need to charge 25 to 50 percent more than the equivalent salaried hourly wage just to break even on take-home.
What to do with the number
Treat the result as the bottom of the range, not the price. Add a margin for profit and slow months, then move toward project or value-based pricing as you get faster, using the hourly floor to sanity-check that a project still clears your minimum per hour. When tax season comes, that self-employment tax in the formula is the same money the IRS expects in quarterly estimated payments, which trip up a lot of new freelancers.
Sources
- Upwork. How to Set Your Freelance Rate (methodology: costs plus profit over billable hours)
- IRS. Self-Employment Tax (15.3% on Social Security and Medicare)
Questions freelancers ask
How do I calculate my freelance hourly rate?
Add the take-home pay you want, your annual business expenses, and the taxes you'll owe, then divide by the hours you can realistically bill in a year. The taxes matter because self-employment tax adds about 15.3% on top of income tax, and the hours matter because almost no one bills a full 40-hour week once admin and sales come out.
Why can't I just match my old salary?
A salary hides payroll taxes, health insurance, paid time off, retirement matching, and equipment that your employer covered. Those land on you as a freelancer, so to keep the same take-home you generally need to charge 25 to 50 percent more than the equivalent salaried hourly wage, before any profit.
How many hours can I actually bill?
Fewer than you'd think. After client calls, proposals, invoicing, marketing, and your own admin, most full-time freelancers bill 20 to 30 hours a week, not 40. Plan your rate around 40 and you'll end up working far more than that just to hit your number.
Should I charge hourly or per project?
Most experienced freelancers move to project or value-based pricing, but the hourly floor here is still the anchor. Estimate the hours a project needs, multiply by your floor, and you have the bottom of your quote.
Educational tool, not tax or financial advice. Tax rates vary by income, state, and deductions; the self-employment tax figure is the 2026 Social Security and Medicare rate. Confirm your own numbers with a qualified professional.