Agencies and consultancies often bill staff at 2.5–4 times their salary cost per hour. The multiplier covers benefits, payroll taxes, office costs, non-billable time and profit.
How to use the Bill Rate Calculator
- Annual salary
- Capacity (hours per year)
- Multiplier
Results update as you type, and every field accepts the units shown in its menu.
How it works
Enter the annual salary, capacity in hours per year and the multiplier.
Tips
- Tax figures here are estimates for planning – your actual tax depends on credits, deductions and local rules.
- Check the tax year and filing status before you rely on a result.
- Use gross (before-tax) figures unless a field asks for take-home pay.
- When in doubt, confirm with the tax authority’s own calculator or a tax professional.
Common mistakes to avoid
- Confusing marginal and effective tax rates.
- Adding sales tax to a price that already includes it.
- Forgetting payroll taxes (Social Security and Medicare) on wages.
Inputs explained
| Field | What to enter |
|---|---|
| Annual salary | Amount in your currency |
| Capacity (hours per year) | A number |
| Multiplier | A number |
What each result means
- Hourly salary cost = [Annual salary]÷[Capacity (hours per year)]
- Bill rate = [Annual salary]÷[Capacity (hours per year)]×[Multiplier]
- Gross margin on billing = (1 – 1÷[Multiplier])×100
- Daily rate (8 hours) = [Bill rate]×8
Example values
How the main result changes when Annual salary changes and everything else stays at the example values above:
| Annual salary | Bill rate |
|---|---|
| 45,000 | 64.9 |
| 67,500 | 97.36 |
| 90,000 | 129.81 |
| 112,500 | 162.26 |
| 135,000 | 194.71 |
| 180,000 | 259.62 |
Formula
Hourly cost = annual salary ÷ capacity (hours per year)Bill rate = hourly cost × multiplierGross margin = 1 − 1 ÷ multiplierWorked example
Inputs — Annual salary: $90,000; Capacity (hours per year): 2,080; Multiplier: 3.
Results — Hourly salary cost = $43.27; Bill rate = $129.81; Gross margin on billing = 66.67 %; Daily rate (8 hours) = $1,038.46.
Frequently asked questions
What is a bill rate?
The hourly rate charged to a client for someone's work.
What multiplier should I use?
2.5–3.5 is common for agencies and consultancies.
What is 2,080 hours?
40 hours × 52 weeks – a full-time year.
What formula does the Bill Rate Calculator use?
Hourly cost = annual salary ÷ capacity (hours per year).