Freelance Hourly Rate Calculator 2026

Set your rate from a target net income — or see what you actually keep from your current rate. Includes self-employment tax, federal and state income tax.

Target net income (annual, $)

What you want to keep after taxes — your living costs, savings and profit.

Billable hours per year

Realistic: 800–1,200 for solo freelancers. Not your total work hours — only hours you actually bill.

State of residence

State income tax from 2026 brackets. Local/city taxes (NYC, Ohio municipalities) are not included.

How do I calculate my freelance hourly rate in 2026?

Start with the net income you need, add self-employment tax (15.3%), federal income tax and your state income tax, then divide by your realistic billable hours. Most solo freelancers bill 800–1,200 hours a year — 30–50% of work time goes to client acquisition, admin and downtime. To net $60,000 in Texas at 1,000 billable hours you need about $78/hour.

How many billable hours should I assume?

800–1,200 per year is realistic for solo freelancers. A 40-hour week is not 40 billable hours: marketing, proposals, accounting and breaks consume 30–50% of your time. Use 1,000 hours as a middle estimate, then adjust for your actual utilization — track it for a month and divide billed hours by total work hours.

How much tax do US freelancers pay in 2026?

Self-employment tax is 15.3% (12.4% Social Security up to $184,500 + 2.9% Medicare) on 92.35% of net earnings, plus federal income tax (10–37% brackets, $16,100 standard deduction) and state income tax in 42 states. The combined effective rate is typically 23–35% depending on income and state.

Why is my rate higher in California than Texas?

State income tax. To net the same $60,000 at 1,000 billable hours you need about $84/hour in California versus $78/hour in Texas — the difference is roughly $3,700 a year in California state tax. Nine states (TX, FL, NV, NH, SD, TN, AK, WY, WA) have no state income tax on wages.

What is a typical US freelance hourly rate in 2026?

Software developers average $100–175/hour, UX/UI designers $75–150, copywriters $60–120, marketing consultants $100–200. Anything under about $40/hour rarely sustains full-time freelancing once taxes and health insurance are paid. Your effective rate after taxes is typically 25–35% lower than your billable rate.

Disclaimer

Indicative estimate based on the rules in force on the verification date. This is not tax advice: always confirm with the tax authority, social security office or your accountant, because your own case may involve allowances, deductions or deadlines.

Data verified on: 21.10.2026

How to BECOME

Register with the social security authority for your country and apply for the reduced starter rate if you qualify. The contribution base can be changed 6 times a year.

How to become self-employed

How to become self-employed: step by step

Six steps with the real deadlines and the official links. Order matters: the registration date is what opens the window for the reduced rate and the VAT threshold.

Two questions decide your structure before you invoice anyone. First, IR35: if your client ends the contract and pays a substitute worker, the client checks your status. If your own limited company is between you and the client, that client is outside IR35 — but clients do check. Second, VAT: you must register if your turnover exceeds £90,000 in any 12 months (from 1 April 2025) — the registration threshold is not a tax allowance.
gov.uk — VAT registration threshold →
A sole trader is the simplest and cheapest to set up, and usually best below ~£50-60k profit. A limited company (Ltd) costs ~£50-500 to incorporate plus £0-820/year in accounts and confirmation statements, but moves employment tax off distributions above ~£80k profit. An umbrella company is just a payroll intermediary for contractors inside IR35 — it is not your own company.
gov.uk — set up a limited company →
You must register for Self Assessment by 5 October in the second year after the tax year you started trading (31 October for a limited company). You get a Unique Taxpayer Reference (UTR) within 2 weeks. You then file a Self Assessment tax return each year, normally by 31 January, with a balancing payment by 31 July.
gov.uk — register for Self Assessment →
As a sole trader you pay Class 4 NI at 6% on profits between £12,570 and £50,270, and 2% above — no cap. Class 2 is voluntary at £3.45/week if your profits are below £7,105 (this preserves your state pension and maternity rights). If you are an employee as well, your Class 4 is reduced by your Class 1 contributions.
gov.uk — self-employed National Insurance →
For sole traders you can use the simplified mileage allowance of 55p per mile for the first 10,000 business miles and 25p after (from 6 April 2026) instead of itemising fuel, insurance, repairs, tax and depreciation. You cannot mix methods for the same vehicle in the same year. For a company car, use the Advisory Fuel Rates to work out the benefit charge instead.
gov.uk — allowable business expenses →
HMRC expects tax to be paid in instalments via the Making Tax Digital quarterly updates (payments on account), and charges interest and penalties if you pay late. Separately, a 1099 or SEIS-free freelance contract pays nothing between contracts: budget 20-30% of your rate for unpaid time, pension, holiday and sick pay that employees get for free.
gov.uk — pay your Self Assessment tax →

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Freelance Hourly Rate Calculator 2026

How do I calculate my freelance hourly rate in 2026?

How many billable hours should I assume?

How much tax do US freelancers pay in 2026?

Why is my rate higher in California than Texas?

What is a typical US freelance hourly rate in 2026?

Disclaimer

How to BECOME

How to become self-employed: step by step

11. Check your VAT and IR35 status first−

22. Decide: sole trader, limited company or umbrella+

33. Register with HMRC for Self Assessment+

44. Get National Insurance right+

55. Claim your allowable expenses properly+

66. Put money aside for tax and for the gaps+

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