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Service Business Hourly Rate Calculator

Find the hourly rate a small service business must charge to cover income, overhead, payroll burden, and a profit target. Trade presets, no signup.

Loads industry-typical defaults. Edit any field below to override.

Income & overhead

Rent, insurance, vehicle, fuel, software, marketing — non-payroll.

Loaded payroll cost (wages × burden multiplier). Solo? Leave at 0.

Profit target
Method
Billable hours

Crew hours, not your work-day length.

50–70% solo, 30–50% team is typical.

Optional

US self-employed (Schedule SE) is 15.3%. Skip if employed.

Recommended hourly rate

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Break-even rate Income + overhead + payroll, no profit.
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Overhead-only rate
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Annual billable hours
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Annual revenue required
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Profit per hour
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Equivalent margin
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Equivalent markup
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Export
How this is calculated

The calculator finds the rate needed to cover income, overhead, payroll burden, and a profit target — divided across your actual billable hours, not paid hours. 

billableHoursPerYear = weeks × daysPerWeek × hoursPerDay × utilization
requiredIncome       = takeHome × (1 + selfEmploymentTaxPct)
breakEvenRate        = (requiredIncome + overhead + payrollBurden) / billableHoursPerYear
recommendedRate (margin) = breakEvenRate / (1 − profitTargetPct)
recommendedRate (markup) = breakEvenRate × (1 + profitTargetPct)

Margin vs. markup: margin is profit ÷ price; markup is profit ÷ cost. A 20% margin equals a 25% markup. We show both so you can quote either way.

The dangerous incumbent bug: dividing overhead by 2,080 paid hours instead of billable hours. Solo operators rarely bill every paid hour — utilization defaults to 60% for that reason.

Sources: ServiceTitan break-even rate guide; Markup & Profit on labor burden; HiBob fully-burdened labor; Mixo + ServiceTitan billable-hour conventions.

How we choose and check our formulas