Hourly Rate Calculator (UK Self-Employed)
Last updated: 12 August 2026
Most tradespeople set their rate by asking what the next man charges. This works it out properly: start from the money you want to take home, add your real overheads and unpaid time, and see the rate you actually need.
How the calculation works
We work backwards. Your target take-home is grossed up for tax and National Insurance, your overheads are added on top, and the total is your required turnover. Divide that by the hours you can genuinely bill and you have your rate.
The two numbers people get wrong are both about time. A year has around 260 weekdays, but holiday, sickness, weather and gaps between jobs mean most sole traders bill 180–220 days. And within a working day, travel, quoting, buying materials and paperwork are unpaid — 6.5 chargeable hours out of 8 is realistic.
What counts as an overhead?
Van finance or lease, fuel, insurance (public liability, tools, van), tool purchase and replacement, phone and broadband, accountant, trade body membership, certification and training, protective equipment, waste disposal, advertising and website. Most sole traders underestimate this by thousands — go through a year of bank statements rather than guessing.
Why "the going rate" is a trap
Charging what the next person charges only works if they did this calculation and you have the same cost base. If they have a paid-off van, no employees and work from home, their floor is far below yours. Know your own number, then decide where to price against the market from a position of knowledge.
Frequently asked questions
How much should I charge per hour self-employed?
Work backwards from your target take-home. If you want £35,000 take-home with £8,000 of overheads, allowing 25% for tax, you need about £54,700 turnover. Over 200 billable days at 6.5 chargeable hours, that is roughly £42 per hour — well above what many sole traders actually charge.
How many billable days are there in a year?
Around 200 for most self-employed tradespeople. There are about 260 weekdays, but holiday, illness, bad weather, quoting time and gaps between jobs all take their toll. Planning on 260 is the single most common pricing mistake.
How do I convert an hourly rate to a day rate?
Multiply your hourly rate by the chargeable hours in a day, typically 6.5 to 8. Many trades set a day rate slightly below the straight multiple as an incentive for full-day bookings, since full days reduce travel and setup time.
How much should I set aside for tax as a sole trader?
Around 25 to 30% of profit is a common rule of thumb for Income Tax and Class 4 National Insurance, but it depends on your profit level and allowances. Set it aside in a separate account as you get paid, and confirm the figure with an accountant.
Should I charge for quoting and travel?
Most trades absorb quoting time and local travel into their rate rather than billing it separately — which is exactly why the rate has to be high enough to cover it. For long journeys or detailed surveys, charging separately is entirely normal and should be agreed up front.
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This is a pricing guide, not financial or tax advice. Tax rates and thresholds change — check gov.uk and speak to an accountant about your own position.