Hourly rate calculator UK: work out your freelance hourly and day rate

A customer asks what you charge. You say £30 an hour, because it sounds about right. Then the year happens: 5 weeks off, 8 bank holidays, a week of flu, and a day a week lost to emails and quotes. The rate that sounded right was never paying for any of that.

This page is for freelancers and sole traders who charge by the hour or by the day, whether you design websites, teach piano or photograph weddings. Use the free calculator below to get both rates in minutes. Nothing you type leaves your browser. Then read how the sum works, so you can check every number against your own year.

Your hourly rate is one sum, and 4 numbers feed it

Your hourly rate is the money the business needs in a year, divided by the hours you can bill in that year. Your day rate is the same money divided by the days you can work. 4 numbers do all the work:

• • Income target. What you want the business to pay you, before tax
• • Business costs. What the business spends to earn it
• • Working days. The days in a year you can actually work
• • Billable hours. The hours in those days you can invoice

Wrong input, wrong rate.

Step 1: decide what the business must earn

Pick the yearly income you want, before tax. Say £40,000. Then add what the business spends to earn it, costs such as software, insurance, equipment, travel and accountancy fees. Say £3,000. The business has to bring in £43,000 for you to be paid £40,000.

Count the costs you pay once a year, like insurance, as well as the monthly ones. Renewals do not warn you.

Step 2: count the days you can actually work

Start with the days in your normal week, times 52. 5 days a week gives 260. Then take away the days nobody pays you for:

• • Annual leave. You choose it. This example uses 25 days
• • Bank holidays. GOV.UK lists them by nation. England and Wales have 8 a year in 2026 and 2027. Scotland and Northern Ireland have more
• • Sick days and training. This example uses 5

260 − 25 − 8 − 5 = 222 working days. 38 unpaid days.

Step 3: count billable hours, not hours at your desk

An 8-hour day is rarely 8 hours of paid work. Emails, quotes, chasing customers and finding the next job fill the rest. A tutor may bill 5 hours of a 9-hour day once planning and travel are counted. A photographer may bill 3 days a week and spend the other 2 editing. If you can invoice 6 hours of your day, use 6.

222 days × 6 billable hours = 1,332 billable hours. It moves your rate most.

Example: what £40,000 and £3,000 of costs turn into

Here is the whole sum with real numbers.

So £40,000 of income and £3,000 of costs mean charging £32.29 an hour, or £193.70 a day. Both rates are rounded up to the next penny, the same way the calculator does it. Raise the income target to £60,000 with the same costs and the rates become £47.30 an hour and £283.79 a day. Same sum, bigger target.

How billable hours change the rate

Here is the rate at 5, 6 and 7 billable hours.

1 hour more or less a day moves the rate by about £5 or £6. 5 fewer days of leave moves it by about 71p. Be honest about billable hours, because the customer pays for your rate and not for your intentions.

Should you charge by the hour or by the day?

Both rates come from the same money, so neither is cheaper for you. Use the hourly rate for work that comes in small pieces, like a few lessons or an afternoon of support. Use the day rate when a customer books you for the whole day.

For a fixed price, multiply your hourly rate by the hours the job should take. Say what it covers.

A rate only pays you once it is on an invoice

A rate in a spreadsheet pays nothing. In EasyInvoice you save your rate once as a product or service, then pick it from your saved items on each invoice. No retyping. Prefer a file? Use the invoice template for the UK. Your rate sets the price, and your payment terms set when the money arrives. EasyInvoice Basic costs £6.99 a month after the 14-day free trial: see the pricing page, or the invoicing features.

FAQ

How do I calculate my hourly rate as a freelancer in the UK?

To calculate your hourly rate as a freelancer in the UK, add your income target and your yearly business costs, then divide by the hours you can bill in a year. Find those hours by taking leave, bank holidays and sick days off a 52-week year, then multiplying the days left by your billable hours per day. The worked example above does it with real numbers, and the calculator does the sum for you.

How do I work out a day rate from a yearly income?

To work out a day rate from a yearly income, divide the money you need to invoice (income target plus costs) by the days you can work. With £43,000 to invoice and 222 working days, the day rate is £193.70. If you are matching a salary, enter it as your income target, and remember that leave, sick days and costs now come out of your own rate.

How many billable hours should I count in a day?

Count the hours you can invoice, not the hours you sit at your desk. Admin, emails, quotes and finding customers are real work, but you usually cannot bill for them. The calculator starts at 6 billable hours in a working day, so change it to what your last few months show.

Is my hourly rate before or after tax?

The rates on this page are before tax, so they leave out income tax, National Insurance and VAT. What applies depends on your own situation. GOV.UK explains when you may need to tell HMRC about your income if you work for yourself, and when you must register for VAT.

Should I charge by the hour or by the day?

Charge by the hour when the work comes in small, uneven pieces, and by the day when a customer books you for the whole day. Both rates come from the same yearly sum, so the calculator gives you both and you can compare them for the job in front of you.