Contractor Rate Calculator

Because as a contractor you cover costs that employers normally pay: self-employment taxes, health insurance, retirement contributions, equipment, software, accounting, and unpaid time off. A straight salary conversion ignores all of this and leaves you earning less.

A common guideline is 25% to 50% above the equivalent salary hourly rate, depending on your tax jurisdiction, benefits costs, and how many hours you can actually bill. The calculator helps you find your specific number.

After subtracting weekends, holidays, vacation, sick days, and non-billable work like marketing and admin, most independent contractors bill 1,200 to 1,700 hours per year. Using 2,080 hours overstates capacity.

Yes. If you expect bench time between engagements, reduce billable hours accordingly. A contractor who is engaged 10 months per year should calculate against 10 months of billable hours, not 12.

Know your floor rate from a calculator like this and never go below it. Frame discussions around the value you deliver and the total cost comparison to a full-time hire. Clients often underestimate what employees really cost them.