Services Sector Calculator

This calculator will help you work out the hourly rate you need to charge to meet your financial needs. Bear in mind the following points:

  1. How much do you need to live on?
  2. Do you intend expanding and employing people?
  3. How much time off do you need for illness and holidays?


  • You are working from home.
  • No administrative assistance is required.
  • Tax and NI are based calculated on the tax rates for 2010/11.
  • Your business is not VAT registered.
  Your Figures Example
  £ £ £ £
Required amount to live on (Net Income) 15,000
Add tax and NI payable 3,950
Net Income 0 18,950
Add: Expenses incurred
insurance 1,000
printing, postage & stationery 500
advertising 500
telephone 1,000
computer software 1,000
computer running costs 500
motor expenses - mileage 2,000
training fees 500
prefessional fees 1,000
bank charges 500
sundry expenses 500
equipment depreciation 500
repairs and renewals 250
use of home 250
contingency 1,000
0 11,000
Fees chargeable 0 29,950

If an average of 30 hours per week can be obtained for 40 weeks, this gives the following calculation:

Your figures:
Required level of fees 0 £0.00 per hour
No. of hours  
Required level of fees £29,950 £24.96 per hour
No. of hours 1,200  

Cost of employing people is calculated as follows:

Gross Salary + 10% NI
No. of chargeable hours
e.g. if paid £15,000 p.a. gross £16,500 = £13.75 per hour cost

Note: when charging by the hour, there is a lot of time that cannot be charged.
This could be due to time taken for administration, supervising and marketing.
If you work at other peoples' premises, you will lose a lot of part days.