What should a consultant in UK charge?
Start from the income you want to take home. We add taxes, expenses, holidays and unpaid admin time, then tell you the hourly, daily and project rate that gets you there.
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| Billable share | Hourly |
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Quote a fixed project: add a 15% buffer for scope creep. For a 40-hour project that is –.
Consultant rates in other countries
Other professions in UK
Guides to price with confidence
How to Calculate Your Freelance Hourly Rate, Step by Step
A five-step method to turn the income you want into an hourly and day rate, including tax, costs, time off and unpaid admin hours.
Read the guideHow to Quote a Fixed-Price Project Without Losing Money
Estimate hours by task, add a buffer, apply your hourly rate and protect the price with scope and change rules. Includes a worked example.
Read the guideHow Much Should a Freelancer Set Aside for Tax?
A simple system to reserve tax money from every invoice, with a worked example and what to check with your tax authority.
Read the guideFreelance Payment Terms: Deposits, Due Dates and Late Payments
How to set deposits, invoice due dates and a late-payment process so you get paid on time, with wording ideas for your proposals.
Read the guideConsultant rates in UK: what to include
The starting figures are placeholders, not market data: a take-home goal of £56,000, business costs of £4,000 and 55% billable time. Change them to match your situation.
Typical business costs for a consultant include travel, insurance, software and time spent on proposals.
Worked example for a consultant in UK
With the starting figures above (£56,000 take-home, £4,000 costs, 22% tax, 55% billable, 40 hours a week, 6 weeks off), you would need about £75,795 in revenue a year. Across roughly 1,012 billable hours, that is about £75 an hour or £330 a day. If your billable share fell to 40% the hourly figure rises to about £103; at 70% it falls to about £59. These are illustrations of the formula, not market rates: replace every input with your own.
How consultants usually price work
Consultants commonly use day rates, fixed-fee engagements or monthly retainers. Because selling and proposal writing take a lot of unpaid time, the billable share is often lower than for production work.
Where consultants lose money
- Unpaid discovery calls and proposals that never convert.
- Open-ended engagements without a defined outcome or end date.
- Travel time and expenses not written into the agreement.
Define the outcome, the deliverables, the client's responsibilities and what happens if the work grows.
Tax and admin in UK
UK sole traders pay income tax plus Class 4 National Insurance on profits, filed through Self Assessment. Once turnover passes the VAT registration threshold (check the current figure on GOV.UK) you must charge VAT.
Remember to set aside money for the payment on account that can arrive in your first full tax year.
- Register as self-employed with HMRC and file a Self Assessment return each year.
- Payments on account can double your bill in the first year you owe tax, so a tax pot matters early.
- If you work through a client's systems, check IR35 rules for off-payroll working on GOV.UK.
Tax year: 6 April to 5 April. Authority: HMRC. Rules and thresholds change: confirm on the official site.
Questions
Why is a consultant's billable share usually lower?
Business development, proposals and admin take time that no client pays for directly. A lower billable share raises the hourly rate you need, which is why the calculator lets you change it.
When do UK freelancers have to register for VAT?
When taxable turnover passes the VAT registration threshold. The figure changes, so read the current number on GOV.UK rather than relying on a copy elsewhere. You can also register voluntarily below it.
How the rate is calculated
Revenue needed = take-home income ÷ (1 − tax rate) + business costs. Billable hours = weekly hours × weeks worked × billable share. Hourly rate = revenue needed ÷ billable hours.
Why not just divide a salary by 2,080 hours?
An employee is paid for holidays, admin and downtime. A freelancer is not. Those hours still need to be covered by the hours you do bill.
Is the tax rate accurate?
No. It is a single flat estimate, because rules differ by country and income. Check with an accountant before you set prices.