/ Finance

The Rate Reverser

Stop undercharging. Calculate your true hourly rate.

To find a freelance hourly rate, work out the gross revenue you need, then divide it by the hours you can actually bill. Take your target net income, add taxes and overhead to get gross, then divide by real billable hours, not 2,080. To take home €8,000 a month at a 30% tax rate, charge about €100 an hour.

How it works

Set your Target Net Income (what you want to take home).

Factor in Taxes and Overhead.

Be honest about Unbillable Hours (admin, sales, coffee).

See the Minimum Hourly Rate you must charge.

Why it matters

Most freelancers take their desired salary and divide by 2,080 (40 hours × 52 weeks). That is a recipe for poverty.

You are not paid for vacation, sick days, or the time you spend chasing invoices. This tool reverses the math to find the rate that actually supports your life.

The Math

Gross Needed = (Net / (1 - Tax Rate)) + Overhead
Billable Hours = (52 - Weeks Off) × (8 - Unbillable/Day)
Min Rate = Gross Needed / Billable Hours

How it's calculated

Three steps turn a take-home target into a rate:

Gross up. Divide your target net by (1 minus your tax rate), then add annual overhead. That is the revenue you have to invoice.

Count real billable hours. Take 52 weeks, subtract weeks off, multiply by 5 days, then by the hours left each day after admin and sales.

Divide and round. Gross needed divided by billable hours, rounded up to a clean number.

At €8,000/month net, 30% tax, €500 overhead, 4 weeks off and 2 unbillable hours a day, that is €143,143 gross over 1,440 billable hours, or about €100/hour.

Worked examples

Monthly overhead €500 and 2 unbillable hours a day held constant.

Target net / mo Tax rate Weeks off Hourly rate
€5,000 30% 4 €65/hr
€8,000 30% 4 €100/hr
€10,000 35% 6 €140/hr
MINIMUM HOURLY RATE
€0/hr
Calculate your rate...

Where did the time go?

Total Potential
2080h
Vacation & Sick
0h
Admin & Sales
0h
Actual Billable
0h

Questions people ask

How do you calculate a freelance hourly rate?

Work out the gross revenue you need, then divide by the hours you can actually bill. Gross up your target net income for taxes and add overhead, then divide by real billable hours: (52 weeks minus weeks off) x 5 days x the hours left after admin. For €8,000/month net at a 30% tax rate, that is roughly €100/hour.

How many billable hours are in a year?

Far fewer than the 2,080 that 40 hours times 52 weeks suggests. Subtract vacation and sick weeks, then subtract the hours each day you lose to admin, sales, and invoicing. A freelancer taking 4 weeks off with 2 unbillable hours a day has about 1,440 billable hours, roughly 69% of the naive figure.

Should I charge more than my old salary divided by 2080?

Yes, and usually a lot more. The 2,080-hour math assumes every working hour is billable and ignores the safety net an employer paid for. As a freelancer you cover taxes, business overhead, unpaid vacation and sick days, plus admin and sales time. Grossing up for all of that pushes the true rate well above salary divided by 2,080.