How the calculation works
Required day rate = (target pay + benefits + annual business expenses) ÷ billable days.
- Subtract leave, holidays and sick days from potential workdays.
- Apply the billable-utilisation percentage to find realistic billable days.
- Add benefits or superannuation provision and business expenses to target personal pay.
- Divide required annual revenue by billable days, then divide by billable hours for an hourly equivalent.
Worked example
With AUD 100,000 target pay, 35 non-working days, 70% utilisation, AUD 15,000 expenses and 12% benefits, 157.5 billable days must recover AUD 127,000, giving AUD 806.35 per day.
Assumptions
- Utilisation represents the share of available working days that can be invoiced.
- Benefits are applied to target personal pay.
- Currency is only a label; no exchange-rate conversion is performed.
Limitations and responsible use
- This is not a tax, legal, award-rate or employment-classification calculator.
- It does not model progressive income tax, GST/VAT, insurance or late payment risk unless included in expenses.
- A commercial rate may need a profit or risk margin above the break-even figure.
Sources and data checks
- Australian Taxation Office: employee or independent contractor
- Australian Fair Work Ombudsman: independent contractors
Source links were reviewed on 4 September 2026. Recheck time-sensitive rates and rules before relying on the result.