Charge Out Rate Calculator UK
Maximise your profitability with our exclusive Charge Out Rate Calculator!
Frequently Asked Questions
Got questions? We’ve got answers. Explore our FAQs to learn how FigsFlow simplifies your workflows and boosts efficiency.
How do I calculate my basic UK charge-out rate?
Take your annual employment cost (salary + National Insurance + pension), add overhead costs, divide by billable hours (typically 1,440), then multiply by 2.5-3.5.
For example, a £40,000 salary plus £12,000 in costs, divided by 1,440 hours and multiplied by 3, would suggest a charge out rate of about £108 per hour before VAT.
Should my UK charge-out rate include VAT?
You must always state if your charge-out rate includes VAT. Most professional services add 20% VAT. So, if your base rate is £100 per hour, you must clearly state that you will be charging £100 + VAT or £120 including VAT. This helps avoid confusion, especially since VAT-registered clients can reclaim it.
How should I adjust my rates for different regions in the UK?
London rates typically run 20% to 40% higher than regional ones. For instance, if the regional rate for your service is £100 per hour, the London equivalent would be £120 to £140 per hour.
Major cities like Manchester or Birmingham usually command 10% to 20% above regional rates, so about £110 to £120 per hour in this example.
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