Calculate exact client charges considering taxes, software costs, and platform fees
Setting the right hourly rate is crucial for sustainable freelancing. Many new freelancers make the mistake of only calculating their direct living expenses while ignoring platform commissions, tax obligations, software subscriptions, and non-billable hours.
Unlike standard employees, freelancers must cover their own healthcare, taxes, equipment maintenance, and software subscriptions (such as Adobe Creative Cloud, ChatGPT Plus, or Figma). Failing to include a tax buffer directly cuts into your net income.
A billable hour is time spent directly working on client deliverables. Non-billable tasks like admin work, marketing, or answering client emails should be factored into your baseline hourly rate.
Platforms like Fiverr charge 20% and Upwork charges 10%. If your target rate is $20/hr, charging clients only $20 means you take home significantly less after platform cuts. Our calculator automatically marks up your quote to protect your target income.
Most full-time freelancers average 25 to 30 billable hours per week out of a 40-hour work week, allowing time for client acquisition and business operations.
Required Hourly Rate = (Desired Net Income + Monthly Expenses + Tax Buffer) / (Monthly Hours * (1 - Platform Fee %))