Most bad formulas take **salary / 260** and call it done. This page adds the pieces payroll used to hide.

Step 1 — Load the salary

Take $120k base. Employer pays $7,650 FICA match + $7,500 health ⇒ ~$135k loaded (simplified). That is your economic cost baseline—see [employer cost calculator](/employer-cost-calculator).

Step 2 — Pick utilization

220 working days × 80% billable = 176 days. Consulting with 5.5 productive hours/day ⇒ 968 hours/year. Loaded $135k / 968h ≈ $139/h before profit.

Step 3 — Add risk margin

Add 12–20% for bench, unpaid invoices, software, PI insurance ⇒ $155–$167/h. Round to $1,200–$1,350/day for an 8h quote.

Euro example

€72k German salary ⇒ employer cost ~€86k. 176 days ⇒ €488/day raw. With 15% margin ⇒ €560/day minimum.

Validate net using [DE calculator](/de/).

Cross-check with calculators

Plug your target employee net into any country tool, read the break-even revenue banner, divide by billable days—numbers should align within a few points; if not, your margin assumption is off.

Singapore and Switzerland quick anchors

S$120k employment with employer CPF might load to S$136k+ TC—divide by ~150 billable days ⇒ S$900+ before risk margin. CHF 130k salary with employer social often costs CHF 148k–155k loaded—CHF 950–1,050/day at ~155 billable days before you add LAMal volatility.

Hourly from daily (and vice versa)

If you sell 8h days but only 5.5h are deep work, your effective hourly for pricing is dayRate ÷ 5.5, not ÷ 8—otherwise you donate ~30% of sellable time.

Utilization vs billable days (220 raw working days base)

Multiply your required annual revenue by (target utilization ÷ actual utilization) when you slip. Example: need $200k at 80% but only achieve 65% ⇒ scale $200k × (80/65) ≈ $246k.

Utilization Billable days Vs 100% util (multiplier)
100% 220 1.00×
90% 198 1.11×
85% 187 1.18×
80% 176 1.25×
70% 154 1.43×
60% 132 1.67×

Subtract **public holidays** separately if your **220** already net of holidays—consistency beats false precision.

FAQ

Use 260 or 220?

Use **billable** days, not HR vacation-inclusive calendars.

Part-time employee compare?

Scale gross pro-rata; employer load % often similar until thresholds.

Overtime?

Employees may get **1.5×**; freelancers should price **rush** explicitly.

Public holidays?

Deduct **10–15** days from raw availability depending on country.

Parental leave?

If planning leave, amortize lost revenue across prior years’ rates.

Rounded day rates?

Round **up** to nearest **$25/€25**—clients anchor on clean numbers.

Retainer vs T&M?

Retainers smooth cash; divide **monthly** by **expected days** for implied day rate.

FX contracts?

Fix currency or add **~2–4%** hedging buffer on cross-border deals.