Charge-out rate calculator for tradies

Most tradies set their hourly rate by asking what everyone else charges. That tells you what the market will bear, but not whether the rate pays for your ute, your insurance, the hours you spend quoting and the weeks you don't work. A charge-out rate built from your own costs tells you the number below which you're working for free. The calculator below does the sums; the rest of this guide explains each number so you can trust the answer.

Charge-out rate calculator

Start with what you want to earn

Put in what you want to pay yourself for a year's work, the way you'd think about a wage. If you employ people, run the calculator for each person you charge out, using what they cost you. A sole trader doesn't have to pay themselves super, but you'll want something for retirement, so most people include it. For employees it isn't optional: the super guarantee has been 12% of ordinary pay since 1 July 2025, according to the ATO.

Add every overhead, not just the obvious ones

Overheads are what the business costs to run whether or not you're on a job. Go through last year's bank statements rather than guessing; the small ones add up.

• Vehicle: finance or lease, fuel, rego, insurance, servicing, tyres, tolls.
• Insurance: public liability, income protection, tool cover, and workers compensation if you employ people.
• Tools and equipment: replacements, repairs, testing and tagging.
• Licences, registrations, memberships and training.
• Phone, internet, software and your accountant or bookkeeper.
• Advertising, your website, uniforms and signage.
• Rent or storage, if you have a shed or yard.

Materials you pass on to a customer are not overheads. They go on the quote as their own line, with your markup.

Be honest about billable hours

This is the number that sinks most rates. You might be working 50 hours a week, but only some of those are hours a customer pays for. Quoting, driving between jobs, picking up materials, chasing invoices and doing the books all take time, and so does the job that runs over the quote. Track your billable hours for a month before you trust any figure here: for most people the number is well below the hours they actually work.

Do the same with weeks. Take out holidays, public holidays, a week or two for sickness and the quiet weeks after Christmas. Whatever is left is your number, and it is never 52.

Add a margin, and know margin from markup

Break-even means the business pays its costs and pays you, but has nothing left to grow, replace the ute or ride out a slow month. The margin is that buffer. The calculator works out the rate so that the margin is a share of the price: a 15% margin means 15 cents of every dollar you charge is profit.

Markup is the same idea measured the other way, as a share of your cost. A 15% margin needs a markup of about 17.6% on cost, and adding 15% to cost only gives you a margin of about 13%. Mixing the two up is one of the most common ways a business that looks busy ends up short.

GST goes on top

If you're registered for GST, your charge-out rate is before GST and you add 10% on the quote and invoice. The GST isn't yours; it goes to the ATO with your BAS. If you're not registered, don't add it. Not sure where you stand? Read when a tradie has to register for GST.

Check it against the market

Once you have your number, compare it with what similar businesses in your area charge. If yours is well above, look first at billable hours and overheads, because those are usually the fix. If it's well below, you may be leaving money on the table. Either way, your rate should rest on your costs, not on the cheapest quote in the suburb. Our guide to pricing a job properly covers turning the rate into a quote, including materials, travel and call-out fees.

How BizzMate helps

In BizzMate, labour and materials logged on a job become the draft invoice when the job is done, and the quote and invoice builders add GST per line. The financial and payments reports show what you've invoiced and been paid, which you can download as a spreadsheet for your accountant. Try it free for 14 days.

This calculator and guide are general information, not legal or financial advice. Talk to your accountant before you change your prices.