Accountants Day Rate (Hourly) Calculator
Estimate the day rate and hourly rate an accountant may need to charge to meet income, overhead and profit targets.
Overview
This accountant day rate and hourly rate calculator estimates the client fees needed to support your desired annual income, cover business overheads and allow for non-billable time. Enter realistic working days, chargeable hours and a profit buffer to create a more sustainable rate target.
How it works
The calculator first subtracts non-billable days from your available working days to estimate annual billable days. It adds your desired income and annual overheads, then increases this amount to allow for your selected profit buffer. Dividing that revenue target by billable days gives a suggested day rate. Dividing the day rate by billable hours per day gives the hourly equivalent.
How to use this calculator
- 1Enter the annual pre-tax income you want to earn from your practice.
- 2Add your expected annual business overheads.
- 3Choose a profit buffer for reinvestment and unforeseen costs.
- 4Enter your available working days and expected non-billable days.
- 5Set the average client-billable hours in a billable day.
- 6Review the estimated hourly and day rates.
Example Calculation
Desired annual pre-tax income
$80,000
Annual business overheads
$20,000
Target profit buffer
10%
Available working days per year
260
Non-billable days per year
70
Billable hours per day
8
Recommended hourly rate
$73.10
With 190 billable days and an annual revenue target of about 111,111, the estimated rate is about 585 per day or 73.10 per hour.
Frequently asked questions
How do I calculate an accountant day rate?
Estimate the annual revenue needed for your income, overheads and profit buffer, then divide it by the number of days you expect to bill clients.
How do I convert a day rate to an hourly rate?
Divide your day rate by the average number of hours you can charge to clients in that day. For example, a 600 day rate over 8 billable hours equals 75 per hour.
What counts as a non-billable day for an accountant?
Non-billable days can include annual leave, training, marketing, networking, internal administration, software setup, sickness and time between assignments.
Why should I include business overheads in my rate?
Your client fees need to cover operating costs such as insurance, software, memberships, equipment and marketing as well as your personal income goal.
What is a reasonable billable time percentage?
It varies by service mix and business stage. A lower percentage may be appropriate if you spend substantial time on administration, client acquisition, compliance or professional development.
Should I charge the same hourly rate for every accounting service?
Not necessarily. You may use this result as a baseline and adjust individual quotes for complexity, urgency, responsibility, specialist knowledge and the value of the work.
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Assumptions and warnings
Assumptions
- Your desired annual income is treated as a pre-personal-tax income target.
- Annual overheads are assumed to be separate from your personal income target.
- The profit buffer is calculated as a percentage of total revenue.
- All billable days are assumed to generate the same average number of billable hours.
- The result is a planning estimate and does not account for differing client rates, discounts, bad debts or late payments.
Warnings
- This calculator provides a business planning estimate only and is not financial, tax or pricing advice.
- Check that your final rate reflects your experience, service scope, local market conditions, taxes and contractual obligations.