Calculate Your Hourly Rate With This Freelance Billable Rate Calculator

1059

English Pound NotesJust howo you set your freelance rates?

In this pricing series we’ve talked about the importance of price v value, the significance of pricing for your target market and the confidence needed to value your worth.

But just how do you translate that into an actual figure?

How do I determine my freelance consulting rate?

Here’s one option. If you run a freelance, service based business the number of billable hours available to you plays a big role.

And to help you translate those number of hours into a billable rate, Jo (our resident techy), has developed this rather nifty tool. So if you know how much you want to earn each year, and what your expenses are (along with a number of other variables), this Hub calculator will give you an idea of  how much you need to be charging / earning per hour.

It’s fab and well worth a try…

Before you dash off and start entering your data, please note there is a BUT. This calculator is not an accountancy tool. Instead it’s intended as a guide and we’d always recommend you seek professional help if you’re unsure.

Enjoy 🙂

How to Use The Freelance Rate Calculator

Enter your costs and desired income per annum, in as much detail as you can.

Anything with an * is a required field (except your email address – this is only required if you want to be emailed your results). Everything else is optional so leave blank anything that doesn’t apply.

Assumptions This Freelance Calculator Uses

  • You are self employed and not a director of a limited company.
  • You have a personal tax allowance of £8,105.
  • You will be paying tax at 20% on income between £8,105 – £42,475.
  • You will be paying tax at 40% on income between £42,475 – £158,105.
  • You will be paying tax at 50% on income over £158,105.
  • You are paying Class 2 National Insurance at £137.80pa.
  • You will be paying Class 4 National Insurance at 9% on income between £7,605 and £42,475 and at 2% on anything over £42,475.
  • If you are not VAT registered enter costs inclusive of VAT.
  • If you are VAT registered enter values net of VAT and then add VAT to the calculated billable rate.

Section 1 - Understanding Your Costs

Rent, Power, Heating, Cleaning or if you work from home enter your weekly allowance
Mileage or Actual Expense, Train Fares, Subsistence
Professional Equipment, Computers, Furniture, Other Assets
One off purchases and software subscriptions
Telephone, Mobile, Internet
Advertising, PR, Networking, etc
VA, SEO, Etc
Purchases required to deliver the sale (e.g. stock)
Professional Bodies & Publications
When a client doesn't pay
Money you want to re-invest in your business next year. Assumed to not be tax deductible.
This calculator assumes this is not tax deductible

Section 2 - Desired Income and Required Turnover

Adding up how much you need to earn

Section 3 - Understanding Your Time

Enter a number between 1 and 7
eg. 48 weeks for 4 weeks holiday / 39 weeks for term time only
Only include days that would have been your usual working days
Only include the ones that will fall on your usual working days
Enter a value between 1 and 100 although usually between 33 - 80% (Do not enter the % sign)
Taking the total number of days you can work after deductions and multiplying by the number of productive hours

Section 4 - Understanding What You Need to Charge

If this is too scary a number go and reassess your desired income and number of days and hours you are available to work. Or your target market 😉

Section 5 - Keeping the Results

We do not save or keep your data.

Disclaimer

Please note this is not an accountancy tool but uses a gross estimate of general expected tax and national insurance payments. The tool is a general estimator of values, and it does have limitations. For full details of your tax and national insurance liabilities along with specific financial questions and any cash flow implications, please ask your accountant as this calculator does not allow for the various inclusions, exceptions and specifics.

Thanks

Big thanks to:

micro business actionToday’s Micro Action

Simple. Try the calculator for yourself 🙂