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Pay Yourself Calculator

Most one-person businesses price forward: materials plus a guessed hourly rate. This calculator works backward instead — start from the income you actually want, add taxes and overhead, subtract the hours you can't bill, and see the rate your work has to earn. Electrician, plumber, handyman, woodworker: the math is the same.

Start from a shop like yours

One tap fills in typical numbers. Change anything after.

What do you want to take home?

Your target personal income before taxes — what the business pays you.

$
$

Sets which 2026 brackets and standard deduction the estimate uses.

Social Security & Medicare — required if you're a sole proprietor or LLC.

Shop overhead

Costs that exist whether or not you have a commission — rent, insurance, software, utilities, blades and bits.

$
$

Billable efficiency

You can't bill every hour. Design time, emails, material runs, glue-ups drying, and cleanup all eat shop time.

31.5 billable hrs/week
Heavy AdminAverage (70–80%)Pure Labor

Your required hourly rate

$50.03/hr
Revenue needed:$78,800.00/yrBillable hours:1575 hrs/yrShop overhead:$13,800.00/yrEst. federal tax:$5,068.95Est. SE tax:$9,184.21Take-home (21.9% tax):$50,746.84/yr

Tax estimate uses 2026 IRS brackets and the standard deduction for single filers. It's a planning number, not tax advice.

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Save $50.03/hr as your default labor rate and turn it into professional quotes — free account, no card required.

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Your required rate

$50.03/hr

Why one-person businesses undercharge

A $50/hr rate feels honest until you do the math. If you're working 40 hours a week but only 30 of those are billable — the rest going to quoting, emails, supply runs, driving between jobs, and cleanup — and you pay self-employment tax on top of income tax, that $50 can shrink to under $30 of real take-home pay before overhead even enters the picture.

The three costs most people forget when they go out on their own: self-employment tax (15.3% for Social Security and Medicare), overhead that runs whether or not you have a job booked, and non-billable time. This calculator makes all three explicit.

How the math works

  1. Start with your target annual gross pay — what the business pays you.
  2. Add annual overhead (monthly overhead × 12, plus your tool budget) to get the revenue your business must produce.
  3. Compute your real billable hours: (52 − vacation weeks) × hours per week × billable efficiency.
  4. Divide revenue needed by billable hours — that's your required hourly rate.
  5. Taxes are estimated separately (self-employment tax plus 2026 IRS brackets and the standard deduction for your filing status) so you can see what you actually keep.

From rate to quote

Knowing your rate is half the job — applying it consistently on every quote is the other half. QuoteItRight saves this rate as your default labor rate, then builds material lists, tiered pricing, and client-ready PDF quotes on top of it. Start free — no card required, and your first quotes are on the house.

More free calculators

See all of our free pricing tools on the calculators page.