Agency charge-out rate calculator

Start from what each person costs: salary, the employer on-costs the law sets in Australia, the UK or the US, other on-costs and a share of overheads. Divide by billable hours, add your margin, and you have an hourly and day rate per role and a blended team rate. It runs in your browser: nothing you type is sent to us.

Calculator

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Sets the currency and the on-costs set by law.

Profit as a share of the price. Same as a markup.

Rent, software, non-billing staff. Split equally per person.

On-costs set by law ()

Filled in from , checked 4 October 2026. Change them if the rates have moved or your case differs.

One row per role. Press Enter to move to the next box.

Rate card

Enter your target margin to see prices.

Each role
Role Cost a year each Billable hours Cost an hour Charge-out an hour Day rate ( h)
Team (blended)

Billing by the hour? In Jasper's time tracking you can set an hourly rate on each project, and people with billing access see billable amounts by client and project in reports.

How we got this

Overheads: ÷ people = each.

Team: ÷ billable hours = ; ÷ (1 − %) = an hour.

How to work out a charge-out rate

  1. Add up what a person costs in a year: salary, employer on-costs and their share of overheads.
  2. Divide by the hours they can bill in a year. That is the break-even rate.
  3. Divide by (1 − your margin) to get the price. Multiply by the hours in a day for a day rate.

Worked example (Australia). Salary $100,000, plus 12% super guarantee ($12,000), plus 5% other on-costs ($5,000), plus a $30,000 share of overheads = $147,000 a year. Over 1,200 billable hours that is $122.50 an hour to break even. For a 30% margin: $122.50 ÷ (1 − 0.30) = $175.00 an hour, which is a 42.9% markup, or $1,330.00 for a 7.6-hour day.

Margin and markup are not the same

Margin is profit as a share of the price; markup is profit as a share of the cost. Mixing them up underprices work: a 30% markup on $122.50 is $159.25, which is only a 23.1% margin.

Margins and the markups that give the same price
MarginSame as a markup of
10%11.1%
20%25%
25%33.3%
30%42.9%
40%66.7%
50%100%
60%150%

Markup = margin ÷ (1 − margin). Margin = markup ÷ (1 + markup).

Employer on-costs by country

  • Australia: super guarantee is 12% from 1 July 2025 (ATO). From 1 July 2026, under Payday Super, it is worked out on each employee's qualifying earnings and paid each payday, up to a maximum contribution base of $270,830 for 2026–27. Payroll tax is a state or territory tax with its own thresholds and rates (business.gov.au); add it, and costs such as workers' compensation insurance, under other on-costs.
  • United Kingdom: for 2026 to 2027, employers pay Class 1 National Insurance at 15% on earnings above the secondary threshold of £5,000 a year (£96 a week, £417 a month) (GOV.UK). For employees under 21 and apprentices under 25, employers pay no NI on earnings up to £50,270 a year (the upper secondary thresholds); this calculator does not apply that. Eligible employers can reduce their NI bill by up to £10,500 a year with Employment Allowance; if you claim it, take it off your shared overheads. The minimum employer pension contribution under automatic enrolment is 3% of qualifying earnings.
  • United States: employers pay 6.2% Social Security on wages up to $184,500 (2026) and 1.45% Medicare on all wages; there is no employer match for the 0.9% Additional Medicare Tax (IRS Topic 751). Federal unemployment tax (FUTA) is 6.0% of the first $7,000 of each employee's wages, less a credit of up to 5.4% for state unemployment tax paid (IRS Topic 759); add it and state taxes under other on-costs.

The calculator works out UK National Insurance on the yearly salary. Payroll works it out each pay period, which gives about the same answer when pay is the same every period (the weekly and monthly thresholds are rounded, so it can differ by up to about £1.20 a year).

Questions

What is the difference between margin and markup?

Margin is profit as a share of the price. Markup is profit as a share of the cost. A cost of $122.50 an hour sold at $175.00 makes $52.50: that is a 30% margin (52.50 ÷ 175) and a 42.9% markup (52.50 ÷ 122.50). Setting a 30% markup instead would give $159.25 an hour, a margin of only 23.1%.

How many billable hours should I use?

Use the hours each person can really bill in a year, after leave, public holidays and non-billable work. The utilisation calculator works this out from contracted hours, 2027 public holidays and a target, and can send the hours straight here.

What are on-costs?

Costs of employing someone on top of their salary. Some are set by law (super guarantee in Australia, employer National Insurance in the UK, Social Security and Medicare in the US); others depend on your business, such as payroll tax, workers' compensation, pension above the minimum, insurance and benefits.

How are overheads shared?

Equally per person: rent, software, and the salaries of people who never bill are added up and split across the headcount. A role with no billable hours still adds its cost to the team, so it raises the blended rate.

Can I use it for contractors?

Yes. Tick "Contractor" and enter what you pay them a year as the salary. No employer on-costs are added. In Australia, super guarantee is still due for a contractor paid mainly for their labour (ATO); leave Contractor unticked for them.

Is this rate what I should charge?

It is the rate that covers your costs and leaves the margin you chose at the hours you entered. Your prices are your own decision; set them yourself rather than agreeing them with competitors.

Does anything I type leave my browser?

No. The sums run in your browser and your figures are saved only in this browser. A share link keeps everything after the # in the address, and browsers never send that part to a server. "Clear my data" removes what is saved here.

Not sure how many hours people can bill? Work it out with the utilisation calculator.

Sources

Last checked 4 October 2026. We link only to the tax office or government.

Changes: 4 October 2026: first published. Next review: 1 January (US), 6 April (UK) and 1 July (Australia).