Free Tool

What should you charge per hour?

Most tradespeople undercharge because they price off their old hourly wage instead of what the business actually costs to run. Plug in your numbers and get the rate you need to charge to pay yourself, cover overhead, and turn a profit.

What you want to pay yourself, before tax.

$

Truck, fuel, tools, insurance, software, phone, marketing.

$

Actual wrench time — not your 40 working hours.

52 minus vacation, holidays, and sick days.

Buffer for slow weeks and reinvestment. 10–20% is healthy.

%

You should charge about

$68 / hour

That's a $546 day rate (8 hrs).

Break-even rate (no profit)
$62/hr
Billable hours per year
1,500
Revenue you need to bill
$102,300/yr

Pre-tax. Set aside ~25–30% for self-employment and income taxes.

How the math works

The calculator uses the standard pricing formula every trade business should run before quoting a job:

Hourly rate = ( Target income + Annual overhead ) ÷ Billable hours per year × ( 1 + Profit margin )

The piece most people get wrong is billable hours. You might work 40 hours a week, but you only get paid for the hours you're on a job. Travel, quoting, buying parts, invoicing, and slow days aren't billable — so your rate has to recover all of that unpaid time plus your overhead and the profit that keeps the business alive.

Stop pricing in a spreadsheet

JobStack turns your rate into estimates & invoices automatically.

Set your rate once and JobStack builds estimates, converts them to invoices, and chases unpaid bills for you. Launching soon — be first in line.

Notify me at launch See how JobStack works

Frequently asked questions

How much should I charge per hour as a contractor?
Add the income you want to pay yourself to your total annual business overhead, then divide by the number of hours you can actually bill in a year. Add a profit margin on top. For a solo tradesperson wanting $75,000 income with $18,000 of overhead and 1,500 billable hours a year, that works out to roughly $62/hour before profit, or about $68/hour with a 10% margin.
Why can't I just charge what I want to earn per hour?
Because you don't bill 40 hours a week. Driving, quoting, invoicing, buying materials, and downtime are unpaid. If you want to take home $40/hour but only bill 30 of your 40 working hours, your rate has to cover the other 10 — plus all your overhead and taxes — so your billed rate ends up much higher than your target take-home.
How many billable hours should I assume per week?
Most solo trades realistically bill 25–32 hours of a 40-hour week once you remove travel, admin, and slow days. Using a lower, honest number gives you a rate that actually covers your costs. Padding it to 40 is the most common reason contractors underprice.
Does this rate include taxes?
No. The result is pre-tax revenue. As a self-employed tradesperson you should set aside roughly 25–30% for self-employment and income taxes. Either treat that as part of your target income or add it to overhead so your rate covers it.
What profit margin should a trade business add?
A 10–20% margin on top of break-even is a healthy buffer. It covers slow weeks, equipment replacement, and reinvestment — and means the business earns money beyond just paying your salary. Break-even pricing leaves nothing for the bad months.

This calculator provides estimates for planning purposes only and is not financial or tax advice. Consult an accountant for your specific situation.