Consulting Fees Calculator

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hrs
Typical consultants bill 1,000–1,500 hours/year.
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Software, office, insurance, taxes above income: typically 20–40%.
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hrs
Finance

Calculate consulting fees, project cost, and effective hourly rate from salary target, overhead, and desired profit margin.

Formula

Hourly rate = (salary ÷ billable hours) × (1 + overhead%) ÷ (1 − profit margin%)
  • Overhead includes self-employment taxes (15.3%), insurance, software, equipment.
  • Profit margin is applied after covering all costs.
  • Typical billable hours: 1,000–1,500 per year (allowing for marketing, admin, and vacation time).

$120k target, 1,200 billable hours, 20% overhead, 15% margin

Inputs
  • Target Annual Income: 120000 $
  • Billable Hours per Year: 1200 hrs
  • Overhead Rate: 20 %
  • Profit Margin: 15 %
  • Project Hours (optional): 40 hrs

Base = $100/hr. With 20% overhead = $120/hr. With 15% margin = $141/hr. 40-hr project = $5,647.

Frequently asked questions

How do I determine billable hours?
Subtract vacation, sick days, marketing, and admin time from a 2,080-hour work year. 1,200–1,500 is typical.
What overhead should I include?
Self-employment taxes (15.3%), health insurance, software subscriptions, equipment, professional development, and office costs.
Is my rate competitive?
Compare to market rates in your industry and geography. Management consultants: $150–500/hr; IT: $75–200/hr; legal: $200–500/hr.
Should I charge by project or hour?
Hourly is safer when scope is unclear. Project pricing can be more profitable if you can estimate accurately.