How many billable hours should I plan for?

Most tradespeople manage 1,400-1,700 billable hours per year. This accounts for travel time, quoting, admin, and days without bookings. Full-time employed hours would be around 1,880 (47 weeks × 40 hours), but self-employed billable hours are always lower.

What overheads do most tradespeople forget?

Commonly forgotten costs include: tool replacement and calibration, vehicle MOT and servicing, training and certification renewal, software subscriptions, phone and broadband, workwear and PPE, waste disposal, and marketing/advertising.

What profit margin should I aim for?

A healthy profit margin for a sole trader is 10-20% on top of costs and target income. This provides a buffer for unexpected expenses, quiet periods, and business growth investment. Below 10% leaves little room for error.

Should I include VAT in my hourly rate?

If you are VAT-registered (mandatory above £90,000 turnover), you must add 20% VAT on top of your rate. The calculator shows both ex-VAT and inc-VAT figures. Remember, VAT collected is not your income - it belongs to HMRC.

How does my hourly rate compare to employed equivalents?

Self-employed rates should be 30-50% higher than employed hourly equivalents to cover: no paid holidays, no employer pension, no sick pay, business overheads, and the risk premium of self-employment.

TradeCalculator

Hourly Rate Calculator

Work out the hourly rate you need to charge to hit your income target

Target Annual Take-Home

Billable Hours per Year

Profit Margin

How We Calculate This

This calculator adds your target net income to all business overheads (van, tools, insurance, accountant, fuel, marketing), then divides by the number of billable hours you can realistically work in a year. A profit margin percentage is applied on top to provide a financial buffer and business growth fund.

Frequently Asked Questions

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Last updated: March 2026

All calculations are estimates. Verify with your supplier.