Day Rate Calculator: Calculate Your Contractor Rate in Seconds
Why use a day rate calculator?
Are you considering a move to contracting or interim work in the UK? Our day rate calculator helps you quickly determine a fair rate based on your current salary. Whether you're exploring contractor opportunities or negotiating your next role, understanding your day rate is crucial. As a contractor, you'll typically be paid for the days you work, without the benefits of permanent employment like holiday pay, sick leave or pension contributions. Our day rate calculator takes these factors into account, ensuring you don't undersell your services.
Day Rate Calculator
How to calculate your day rate
- Enter your current annual salary
- Click ‘Calculate’
- Instantly see your suggested day rate and hourly rate
It's that simple! Our calculator uses a widely accepted formula in the UK interim management industry:
(Annual Salary + 30%) / 220 working days
The 30% addition compensates for the benefits you'd forgo as a contractor, while 220 days accounts for holidays and potential gaps between assignments.
Understanding your results
Your calculated day rate reflects what you should aim for to maintain a comparable income to your current salary, accounting for the differences in contractor work. The hourly rate is provided for additional context and flexibility in negotiations.
Tailoring your rate
While our calculator provides a solid starting point, remember to consider:
- Your industry and expertise
- Current market rates
- Project complexity
- Contract duration
These factors may influence your final rate negotiations.
Ready to make the move?
Understanding your day rate is just the first step. As you transition to contracting, consider:
- Setting up a limited company or joining an umbrella company
- Budgeting for taxes and National Insurance contributions
- Planning for periods between contracts
Take action now
Use our day rate calculator now to determine your worth as a contractor. With this knowledge, you'll be better prepared to negotiate fair compensation for your skills and experience in the UK contractor market.
Disclaimer: This calculator provides estimates based on general formulas. PRS UK accepts no liability for decisions made using these calculations. Always seek professional financial advice for your specific situation.