Updated · Built and checked by the PlinzoTools team, formulas tested against published sources
Convert tracked hours into an invoice amount, net of non-billable time.
$2625.00
This calculator converts total hours worked into an invoice-ready amount, after subtracting non-billable hours (admin, overhead, unpaid meetings) -- and shows your utilization rate, the percentage of total time that was actually billable, a common freelance and consulting metric.
Enter total hours worked, non-billable hours, and your hourly rate. The result shows billable hours, the resulting invoice amount, and your utilization rate.
Billable hours = total hours - non-billable hours. Invoice amount = billable hours x hourly rate. Utilization rate = (billable hours / total hours) x 100.
40 total hours, 5 non-billable hours, at $100/hr: 35 billable hours, $3,500 invoice (87.5% utilization).
To sum a full week's daily hours into a gross total first, see the Timesheet Calculator.
A consultant logs 46 hours in a week, of which 9 are non-billable (proposals, invoicing, and a team call), at a hypothetical rate of $85 per hour. Billable hours are 46 minus 9, or 37. The invoice amount is 37 times 85, $3,145, and utilization is 37 divided by 46, about 80.4 percent. Note that the calculator subtracts what you enter as non-billable from the total, so both figures must cover the same period and be tracked in the same units.
Your billing agreement is the authority. Time is usually billable when it is directly on a client's task and the contract lets you charge for it. Administrative work, marketing, learning, and correcting your own mistakes often are not. Some contracts allow billing for travel or client-requested research, so read yours before deciding. Entering too little non-billable time inflates your invoice and can cause disputes, while entering too much undercharges you.
Many contracts bill in increments, for example the nearest tenth of an hour or quarter hour. The tool does not round, so it will multiply exactly the numbers you enter. If your agreement bills in 15-minute increments, round each entry before you type it in, otherwise the invoice figure here can differ slightly from the one you send.
Utilization is billable hours divided by total hours, expressed as a percentage. A low rate does not always mean poor performance, since business development, training and administration all take time, especially early in a freelance business. Track your own rate across several weeks and look at the trend. If it falls, ask whether admin work is growing or whether you are taking on work that is difficult to bill. Note that a 100 percent rate is not realistic for most people, since some overhead is unavoidable.
Because non-billable hours are unpaid, your effective earnings per hour worked is lower than your rate. For instance, at $85 with 80 percent utilization, effective pay per total hour is about $68, before taxes and expenses. Compare that with the income you need when deciding whether to raise prices. Self-employment taxes and business costs are not included here, so consult a tax professional for anything beyond estimating invoice totals.
Internal admin work, unpaid client communication, business development, and any other hours you can't invoice a client for -- what specifically counts varies by your own billing agreement.
It varies widely by role and industry -- full-time consultants often target 70-85%, since some non-billable time (admin, business development) is unavoidable.
No -- this assumes a single flat rate for all billable hours; calculate different rate tiers separately and sum the invoice amounts.
No. It uses your exact numbers. If your contract bills by quarter hour, round your entries first so the total matches your invoice.
It is just billable hours times your rate. It does not add sales tax, discounts or expenses, so adjust those separately if they apply.
Only one rate can be entered at a time. Run each rate separately with its own hours and add the invoice amounts together.
Reference: U.S. Department of Labor