{
  "slug": "contractor-hourly-rate",
  "title": "Contractor Hourly Rate Calculator",
  "heading": "Contractor Hourly Rate Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/contractor-hourly-rate",
  "summary": "The rate you must charge to hit your target take-home.",
  "description": "Billable hours are never 40 per week. Once you subtract bidding, driving, and admin, most solo trades bill 55–70% of their working time.",
  "formula": "Rate = (target income + overhead) ÷ billable hours ÷ (1 − profit margin).",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=contractor-hourly-rate",
  "inputs": [
    {
      "id": "income",
      "label": "Target take-home income",
      "kind": "number",
      "hint": null,
      "default": 90000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "overhead",
      "label": "Annual overhead",
      "kind": "number",
      "hint": null,
      "default": 24000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "weeks",
      "label": "Working weeks per year",
      "kind": "number",
      "hint": null,
      "default": 48,
      "unit": null,
      "min": 1,
      "max": 52
    },
    {
      "id": "hours",
      "label": "Working hours per week",
      "kind": "number",
      "hint": null,
      "default": 45,
      "unit": null,
      "min": 1,
      "max": 90
    },
    {
      "id": "billable",
      "label": "Billable share of hours",
      "kind": "number",
      "hint": null,
      "default": 65,
      "unit": "%",
      "min": 10,
      "max": 100
    },
    {
      "id": "tax",
      "label": "Tax rate on profit",
      "kind": "number",
      "hint": null,
      "default": 25,
      "unit": "%",
      "min": 0,
      "max": 60
    }
  ],
  "outputs": [
    {
      "id": "rate",
      "label": "Hourly rate to charge",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "dayRate",
      "label": "8-hour day rate",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "billableHours",
      "label": "Billable hours per year",
      "format": "decimal",
      "hint": null,
      "primary": false
    },
    {
      "id": "needed",
      "label": "Revenue needed per year",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "weekly",
      "label": "Revenue needed per week",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "breakEven",
      "label": "Overhead cost per billable hour",
      "format": "currency",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Target take-home income: 90000 $",
      "Annual overhead: 24000 $",
      "Working weeks per year: 48",
      "Working hours per week: 45",
      "Billable share of hours: 65 %",
      "Tax rate on profit: 25 %"
    ],
    "outputs": [
      "Hourly rate to charge: $102.56",
      "8-hour day rate: $821",
      "Billable hours per year: 1,404",
      "Revenue needed per year: $144,000",
      "Revenue needed per week: $3,000",
      "Overhead cost per billable hour: $17.09"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter target take-home income ($).",
      "Enter annual overhead ($).",
      "Enter working weeks per year.",
      "Enter working hours per week.",
      "Enter billable share of hours (%).",
      "Enter tax rate on profit (%).",
      "Read your hourly rate to charge on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "income": 54000,
        "overhead": 14500,
        "weeks": 29,
        "hours": 27,
        "billable": 39,
        "tax": 15
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "income": 90000,
        "overhead": 24000,
        "weeks": 48,
        "hours": 45,
        "billable": 65,
        "tax": 25
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "income": 144000,
        "overhead": 38500,
        "weeks": 52,
        "hours": 72,
        "billable": 100,
        "tax": 40
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "How does the contractor hourly rate calculator work?",
      "a": "Billable hours are never 40 per week. Once you subtract bidding, driving, and admin, most solo trades bill 55–70% of their working time. The underlying maths is: Rate = (target income + overhead) ÷ billable hours ÷ (1 − profit margin)."
    },
    {
      "q": "What do I need to enter?",
      "a": "6 values: target take-home income, annual overhead, working weeks per year, working hours per week, billable share of hours, and tax rate on profit. Each field starts with a sensible default, so you can change one number at a time and watch the result move."
    },
    {
      "q": "What does the hourly rate to charge result mean?",
      "a": "It is returned as a money amount in US dollars and updates live as you edit the inputs, so you can compare two or three versions of a scenario in a few seconds."
    },
    {
      "q": "Is this calculator free, and do I need an account?",
      "a": "Yes, it's free, and no account is required. Nothing you type is stored on our servers — the maths runs entirely in your browser."
    },
    {
      "q": "How accurate is the result?",
      "a": "It applies the standard formula exactly, so the arithmetic is precise. Results are estimates before tax, fees, and inflation unless an input explicitly covers them."
    },
    {
      "q": "Who is this tool for?",
      "a": "It's built for anyone comparing money scenarios before committing — budgeting a payment, sanity-checking a quote, or seeing what a change in rate or term actually costs."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/job-bid-markup",
    "https://www.revenuelab.fyi/toolbox/freelance-rate"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Contractor Hourly Rate Calculator (https://www.revenuelab.fyi/toolbox/contractor-hourly-rate)"
}