UK freelance pricing
Contractor day rate calculator UK
Estimate the contractor day rate needed to replace a salary or hit an income target, then check IR35 and tax assumptions before accepting a contract.
Estimate the contractor day rate needed to replace a salary or hit an income target, then check IR35 and tax assumptions before accepting a contract.
Salary equivalent: £60,000. Billable days: 220. Basic replacement day rate: about £273 before pension, expenses, bench time and IR35 impact.
A rough contractor day rate can be estimated by adding your desired income, business costs, pension replacement, holiday cover, and a bench-time buffer, then dividing by paid contract days. Salary comparisons often understate the rate because permanent employment includes benefits and paid downtime. A £60,000 salary divided by 220 working days gives about £273, but that is only the starting point. Once you add pension, insurance, accountancy, equipment, unpaid gaps, and tax structure, the sustainable rate may need to be materially higher.
Before accepting a contract, check whether the role is inside or outside IR35 and whether you will be paid through an umbrella company, agency payroll, or your own company. Inside IR35 contracts often need a higher day rate to produce the same take-home pay because employment taxes and fees can change the result. This page gives a commercial floor; IR35Guide.co.uk helps you sense-check the status side.
The homepage calculator lets you model working days, expenses, and target income more flexibly. Use this page when you are comparing a contract offer with a permanent role, deciding whether a rate is worth the risk, or working out the minimum day rate before speaking to a recruiter. For project-based freelancing, compare with the UK freelance day rate calculator.
Is 220 billable days realistic? It can be for a long contract, but it is optimistic if you expect gaps, holidays, sickness, or time spent finding the next role.
Should inside IR35 contracts pay more? Often yes. Compare net outcomes, not just headline day rates.
Can I use this for umbrella roles? Yes as a planning tool, but include umbrella fees and employment-tax effects before deciding.