Billable Hours Calculator

What are billable hours?

Billable hours are the hours you can charge to a client. Non-billable hours are still work—sales, administration, proposals, bookkeeping, and internal projects—but they do not appear on an invoice.

A realistic billable-hours estimate starts with your workweek, subtracts vacation and holidays, then applies a utilization percentage. It does not assume every working hour is sold.

What is billable utilization?

Billable utilization is the share of available working hours you expect to invoice. At 60% utilization, 40% of available time is reserved for work you do not bill.

There is no universal “good” percentage. Solo freelancers often land lower than a studio with dedicated sales support. Try a few values and see how annual hours change.

How to calculate annual billable hours

Potential hours = Hours per day × Days per week × 52

Time-off hours = Hours per day × (Vacation days + Holidays)

Available hours = Potential hours − Time-off hours

Billable hours = Available hours × (Billable percent ÷ 100)

8 hours/day, 5 days/week, 15 vacation days, 10 holidays, 60% billable:

8 × 5 × 52 = 2,080 potential hours

8 × 25 = 200 hours of time off

2,080 − 200 = 1,880 available hours

1,880 × 0.60 = 1,128 billable hours per year, about 94.0 per month or 21.7 per week.

Why realistic billable hours matter for rates

If you divide an income goal by more hours than you can actually bill, the required rate looks too low. Time off and non-billable work are part of the year, not leftovers.

After you have a billable-hours number, use the Freelance Rate Calculator to turn an income goal, expenses, and utilization into an hourly rate.

Practical example

A consultant works 8-hour days, five days a week, takes 15 vacation days and 10 holidays, and bills about 60% of remaining time. They have 1,128 billable hours in the year. At $125/hour, that is about $141,000 in billable revenue before expenses and tax—not take-home pay.

Frequently asked questions

What are billable hours vs non-billable hours?

Billable hours are working time you charge to clients. Non-billable hours are available working time spent on sales, administration, proposals, bookkeeping, and other work you do not invoice.

Why doesn’t this calculator assume all working time is billable?

Most freelancers and service businesses spend part of the week on work that is not billed. Using 100% utilization usually overstates how many hours you can sell and understates the rate you need.

How are vacation and holidays handled?

Vacation days and public holidays are converted to hours using your hours per day, then subtracted from a 52-week work year. Remaining hours are your available working time before applying utilization.

Why does the calculator use a 52-week year?

A 52-week year is a simple planning assumption so you can see capacity before time off. Change vacation and holiday days to match the time you actually take.

Is the optional revenue figure take-home pay?

No. It multiplies billable hours by the hourly rate you enter. It does not subtract expenses, taxes, or unpaid time, and it is not a quote or invoice total.

How is this different from the Freelance Rate Calculator?

This calculator estimates how many hours you can bill. The Freelance Rate Calculator starts from an income goal and works backward to a required hourly rate. Use them together when you set prices.

Related calculators

Put hours on an invoice with the Hourly Invoice Calculator or check a full invoice total in the Invoice Calculator. Set a required rate with the Freelance Rate Calculator, including its hourly vs project rate notes. A Project Invoice Calculator is listed as coming soon on All Calculators.