An hourly rate only works if it covers the hours you cannot bill. Every freelancer and small firm spends time on work that no client pays for directly: quoting, admin, marketing, learning and fixing problems. If your rate assumes every working hour is billable, you will earn far less than you planned. This tool adjusts your rate for the share of time that is really billable, so non-billable hours are covered.
Enter your base hourly rate, the billable share as a percent, your target annual income, your work hours per week and your work weeks per year. The tool shows the adjusted rate, your billable hours per year, and the rate you actually need to reach your income target. Those three numbers together give a realistic picture of what you must charge.
Work through an example. A base rate of 50 dollars at 75 percent billable becomes an adjusted rate of about 66.67 dollars, because only three quarters of your time earns money. If you work 40 hours a week for 48 weeks, your billable hours are 1,440 per year. To earn 60,000 dollars from 1,440 billable hours, you need about 41.67 dollars per billable hour before other costs, which shows why the adjustment matters.
Many freelancers discover a gap when they first run these numbers. They set a rate that looks fine, then wonder why annual income falls short. The usual cause is simple: they planned for 40 billable hours a week but actually bill 25 or 30. The rest goes on quoting, emails, admin and gaps between jobs. Pricing for real billable time closes that gap without needing longer working hours.
Measure your billable share honestly for a few weeks before you trust it. Keep a simple log of billable and non-billable hours, then use the real percent in the tool. Guessing a high billable share gives a low rate that will not cover your year. It is better to use a cautious figure and adjust later than to undercharge for months.
Common mistakes include forgetting holidays and sick days when counting work weeks, and treating every hour at a client site as billable when some of it is travel or waiting. Another mistake is setting the income target as gross revenue rather than the income you need after business costs. Be clear about which figure you enter, and add business costs on top where needed.
Use the tool when you set rates for a new year, when you change the kind of work you do, or when income keeps falling short of plan. Re-run it with fresh hours data each quarter. Rates should move with reality: if your billable share falls because you spend more time quoting, your rate needs to rise to compensate, or your quoting process needs to get faster.
This tool is free, runs in your browser and needs no account. It is an estimating aid, not professional financial advice. Tax, business costs and local market rates all affect the right price for you, so use the result as a starting point and check it against your real accounts. Charging for real billable time is fair to you and fair to clients.
Keep business costs separate from your income target when you use the tool. The income figure should be the money you need to take home, or the revenue target you have set after costs, but do not mix the two in one number. If you enter take-home pay while forgetting software, insurance, vehicle and phone costs, the rate will still fall short. List your annual business costs once a year, add them to your income target to get a revenue target, and then run the tool on that combined figure. That single habit turns a rough rate into a realistic one, and it explains clearly why your rate sits where it does when clients compare you with cheaper competitors.
Also available in Spanish: Calculadora de Tarifa por Hora según Tiempo Facturable.