How it works

We built this because our invoice-template guide kept getting the same question: what should I actually charge? Enter the annual income you want (before tax), your annual business expenses, and the days you cannot bill — holidays, sick days and admin days. The calculator starts from 260 working days in a year (52 weeks times 5 days), subtracts the days you cannot bill, and divides what you need to earn by the days that are left.

With the defaults — £40,000 income, £2,000 expenses, 220 billable days — the answer is £190.91 a day, or £25.45 an hour. Change any number and the result updates straight away, so you can see what happens if you take more holiday or raise the income you are aiming for.

Nothing you type leaves your browser. There is no account, no upload, and nothing is stored.

What the number means

The day rate is the gross rate to charge a client. It is the income you want plus the costs of running the business, spread across the days you can actually bill. That is the whole point of the calculation: an employee’s salary is spread across paid working days, but a freelancer is only paid for the days a client books. The days you spend on holiday, ill, or doing admin still need paying for, and the rate has to carry them.

The hourly rate is the day rate divided by 7.5 hours, a standard working day. It is there for the times a client asks for half a day or a few hours, so you do not end up pricing short work by guesswork.

What it does not cover

This is a starting point, not a correct rate. Three things it leaves out on purpose:

  • Tax and National Insurance. The rate is gross. Income tax, Class 2 and Class 4 National Insurance, and any student loan repayments come out of what you earn — they are your liability, not the client’s, and this calculator does not deduct them. Work out the gross income you need — remember tax and National Insurance come out of it — then enter that figure. If you start from what you need after tax, add the tax and National Insurance back first.
  • Paid holidays and an employer pension. Employees get both. Freelancers get neither, and the rate has to cover the gap: the holiday and sick days you subtracted above are unpaid, and there is no employer putting money into a pension for you. If you want a pension, the contributions have to come out of the income this rate produces.
  • What the market will pay. Experience, demand, location and the kind of work all move the rate. A number this calculator produces is what you need to earn; whether clients will pay it is a separate question, and the honest answer is sometimes no. If the rate looks high against what clients in your field pay, the lever is usually the income target or the number of billable days, not the maths.

Once you have a rate

Put it on an invoice with our freelancer invoice template generator — it builds a clean UK invoice with the rate, VAT where applicable, payment terms and bank details. If a client pays late, our late payment interest calculator works out what they owe on top.

This page explains general information for UK freelancers. It is not financial advice. If the amount is large or the situation is complicated, get proper professional advice.