ClarityHow to use this tool
- Enter target annual compensation, annual business overhead, annual billable hours.
- Select Calculate to view the result.
- Check the method and assumptions below before using the result.
The method, explained
Required rate = (target compensation + overhead)/billable hours.
Using target annual compensation = 50000 money, annual business overhead = 10000 money, annual billable hours = 1200 hours, the result is 50 currency. Change these example inputs to match your task; use the method above to check each step.
What to keep in mind
Taxes, unpaid leave and profit reserves are included only if entered in the targets. Use consistent currencies, reporting periods and accounting definitions. This arithmetic estimate excludes items not entered in the form.
Common questions
Which inputs does this calculation need?
Estimate a billed hourly rate from revenue needs and billable hours. Enter target annual compensation in money, annual business overhead in money, annual billable hours in hours. The filled example is editable and is not a saved personal record.
How should I interpret the result?
Taxes, unpaid leave and profit reserves are included only if entered in the targets. Use consistent currencies, reporting periods and accounting definitions. This arithmetic estimate excludes items not entered in the form.
Methodology maintained by ClarityKit. How these tools are built and checked.