Freelance Target Income Calculator
Estimate the hourly rate and billable workload you may need to reach your target freelance income after business costs and time off.
Overview
This freelance target income calculator helps you estimate how much revenue and what hourly rate you may need to reach your desired annual income. Enter your target income, annual business expenses, tax allowance, working weeks, weekly hours and expected billable percentage to see a practical pricing target.
How it works
The calculator starts with your target personal income and annual business expenses, then adds a simple percentage buffer for taxes if you include one. That gives the total revenue target for the year. It then estimates how many billable hours you will actually have by multiplying your working weeks and weekly hours, then applying your billable time percentage. Finally, it divides the required annual revenue by your annual billable hours to estimate the hourly rate you may need to charge.
How to use this calculator
- 1Enter the annual personal income you want your freelance work to produce.
- 2Add your estimated annual business expenses.
- 3Set a tax allowance percentage if you want to build in a buffer for taxes.
- 4Enter how many weeks you expect to work during the year.
- 5Add your total working hours per week.
- 6Estimate the percentage of your time that will be billable and review the required hourly rate and revenue target.
Example Calculation
Target annual personal income
$60,000
Annual business expenses
$12,000
Tax allowance rate
20%
Working weeks per year
46
Hours worked per week
40
Billable time
60%
Required hourly rate
$78.26
With a $60,000 income target, $12,000 of annual expenses, a 20% tax allowance, 46 working weeks, 40 hours per week and 60% billable time, the estimated required revenue is about $86,400 and the required hourly rate is about $78.26.
Frequently asked questions
What does the freelance target income calculator estimate?
It estimates the annual revenue, hourly rate and billable workload you may need to reach a chosen freelance income target.
What is billable time?
Billable time is the share of your working hours that you can charge directly to clients. It usually excludes admin, marketing, sales, invoicing and unpaid revisions.
Should I include taxes in my target income?
You can use the tax allowance rate to add a planning buffer, but it is only a simple estimate and not a full tax calculation.
Why is my required hourly rate higher than expected?
Many freelancers have fewer billable hours than total working hours, and business expenses also need to be covered by client revenue.
Can I use this calculator if I charge by project instead of by hour?
Yes. The hourly rate can still be a useful benchmark for pricing projects, retainers or day rates.
How do I choose a realistic billable percentage?
Many freelancers use a billable percentage below 100% because time is also spent on prospecting, admin, meetings and business development. A common planning range is around 50% to 75%, depending on your work style.
Explore Related Calculators
Assumptions and warnings
Assumptions
- Results are estimates based on the income target, expenses, tax allowance and billable time you enter.
- The calculation assumes your hourly rate is applied consistently across your billable hours.
- Business expenses are treated as annual costs and do not include unexpected one-off expenses unless you add them.
- The tax allowance rate is a simple planning buffer and does not calculate actual tax rules or deductions.
Warnings
- This calculator provides an estimate only and is not financial or tax advice.
- Freelance income, taxes, utilisation and pricing can vary, so review your numbers before making major business decisions.