Contractor Rate Calculator Australia – Hourly Rate from Salary

Setting Your Contractor Rate in Australia

Transitioning from employment to contracting in Australia means taking on expenses that an employer would normally cover — superannuation, insurance, leave, and equipment. Our contractor rate calculator helps you determine the hourly or daily rate you need to charge to match or exceed your current take-home pay as an employee.

Enter your current salary (or desired equivalent income), and the calculator factors in employer-paid costs such as superannuation (11.5% as of 2024–25), payroll tax, workers compensation insurance, annual leave, personal leave, and public holidays. The result is the minimum rate you should charge to maintain the same financial position.

What Expenses Do Contractors Cover?

As a contractor, you are responsible for your own superannuation contributions, income protection and public liability insurance, professional indemnity insurance (if applicable), accounting and tax return fees, equipment and software costs, and any periods without work between contracts.

You also lose the benefit of paid leave. A full-time employee effectively receives about 46–47 working weeks of pay for 52 weeks of the year, once annual leave, personal leave, and public holidays are deducted. As a contractor, you need to earn enough during your billable weeks to cover these non-billable periods.

How to Calculate Your Rate

A common rule of thumb is to divide your desired annual income (plus all overhead costs) by the number of billable hours you expect to work. Most contractors estimate 46–48 billable weeks per year (accounting for holidays and gaps between contracts) and 7–8 billable hours per day.

For example, if you want the equivalent of a $120,000 salary, your total cost including super, insurance, leave, and overheads might be $160,000–$170,000. Divided by approximately 1,700 billable hours, this gives an hourly rate of around $95–$100 plus GST. Our calculator performs these calculations precisely based on your inputs, so you can negotiate contracts with confidence.