Hourly Billing Rate Calculator
The hourly billing rate is the price a trades business charges customers per working hour. It covers labor costs, overheads, owner salary, profit, and risk allowances and must generate enough to cover all operating costs and a reasonable return.
Based on the Chamber of Crafts costing scheme: total costs ÷ productive hours × (1 + profit% + risk%).
How do you interpret the result?
The calculated hourly billing rate is your minimum rate for covering all costs. If your current hourly rate is below this, you are working below cost. The net billing rate is your target price before VAT. Market conditions and customer mix determine whether it can be achieved.
Not included: material surcharge, subcontracted services, and project-specific line items.
Costing scheme (HWK)
Cost-covering
Total costs ÷ total productive hours
Price floor: covers all costs, no profit.
Net billing rate
Cost-covering × (1 + profit% + risk%)
Target price before VAT.
Gross billing rate
Net billing rate × 1.19
Invoice price incl. VAT.
Example: HVAC with 3 journeymen
- Total costs/year≈ 220,000 EUR
- Productive hours4,860 h
- Profit + risk13 %
220,000 ÷ 4,860 × 1.13 = 51 EUR/h
≈ 51 EUR/h
Net billing rate (incl. profit and risk)
Frequently asked questions about the hourly billing rate
Sources and further links
Sources
Next steps
Once you know your hourly billing rate, you can check how much your warehouse is costing you on top. Or you can read the detailed guide to billing-rate calculation.
