Service price calculator
This service price calculator works backwards from the take-home pay you want: it adds the tax on that pay, your business expenses and the money you reinvest, then divides by the hours you can bill — giving the minimum hourly rate, and flat prices for 2-, 4- and 8-hour jobs.
$132.41 minimum hourly rate
Charge less than this for an hour you bill, and the year won’t leave you $100,000 after tax.
+ $33,333 of tax
Self-employment tax plus income tax.+ $17,333 kept back
A share kept back for growth and savings.How the minimum rate is calculated
The minimum rate is the revenue the business has to bring in, divided by the hours you can bill. With the figures in the calculator above — $100,000 of take-home pay, 25% tax, $40,000 of expenses and 10% reinvested, over 30 billable hours a week for 48 weeks — the business needs $190,667 a year, which is $132.41 an hour across 1,440 hours. The result is a floor: it pays you, the tax, the expenses and the reinvestment, and nothing more.
The steps, with your figures
- 1
Gross up for tax
Take-home pay ÷ (1 − tax rate): the income that leaves your take-home once the tax is paid.
$100,000 ÷ (1 − 25%)= $133,333 - 2
Add expenses
Pre-tax income + yearly business expenses.
$133,333 + $40,000= $173,333 - 3
Add reinvestment
That total × your reinvestment percentage, added on: the revenue the year needs.
$173,333 + 10% ($17,333)= $190,667 - 4
Divide by the hours you bill
Revenue needed ÷ (billable hours a week × weeks worked).
$190,667 ÷ (30 × 48 = 1,440 h)= $132.41/h - 5
Set flat prices
The hourly rate × 2, 4 and 8 hours: the least to charge for a 2-hour job, a half day and a full day.
$132.41 × 2 · × 4 · × 8= $265 · $530 · $1,059 - Your minimum rate$132.41 an hour
Pricing your services, answered
How do I set prices for my service business?
Work out your floor first, then look at your market. The floor is the minimum rate this calculator gives: the least an hour can bring in and still pay you, the tax, your expenses and what you put back. If local competitors charge well above it, price nearer to them; the floor is not the price. If they charge less than your floor, a lower price will not fix it: the year only works with lower expenses, more billable hours or better-paid work.
Should I charge hourly or per job?
Either works if the rate underneath is right. Flat prices give the customer a fixed number and pay you more per hour as you get faster at jobs you repeat; hourly pricing protects you on jobs you can’t scope. The 2-, 4- and 8-hour prices this calculator shows are flat prices built from your minimum rate.
- 3 hours$176.54 an hour
- 4 hours$132.41 an hour
- 5 hours$105.93 an hour
- 6 hours$88.27 an hour
Finish in 3 hours and the same price pays $176.54 an hour. Let it run to 6 and it pays $88.27, under your minimum.
Worked from your figures above
How many billable hours can I realistically work?
Fewer than the hours you work. Travel, estimates, admin and marketing all take time nobody pays for. Track a few weeks of your own time to find the real number — overestimating billable hours makes every price on this page too low.
Over the 1,440 hours you really bill, the year comes in $27,238 short of the $190,667 it needs.
Worked from your figures above
Each pricing calculator here starts from a different number. This one starts from the pay you want to keep; the others start from a salary, from one job, or from a month already worked.
- The take-home pay you wantA minimum hourly rate, and flat 2-, 4- and 8-hour pricesService price calculatorThis page
- A salary and your overheadAn hourly rate with a profit markup, and an after-hours rateContractor hourly rate calculator
- One job’s labor, materials and overheadThe price of that jobService pricing calculator
- A month of finished workWhat you actually kept, once the month is doneProfit margin calculator
From your hour to a paid week
Business Genie sends the estimate with a deposit, schedules and routes the job, and invoices a customer who can pay online. Free for a month, no credit card to start.
- 1You’re here
Your hour, $132.41
Worked down from the year you want, above.
- 2
On an estimate, $530
The hour laid four long: send the half-day price as an estimate, with a deposit taken before the job.
- 3
- 4The week the year needs
Invoiced and paid, $3,972
Invoiced from each job, paid online by card, Apple Pay, PayPal, Venmo or Cash App.