Question 1

What tax rate should European freelancers use?

Accepted Answer

This varies dramatically by country. Ballpark effective rates (income tax + self-employed social contributions) for a €70-€90K gross freelancer: Germany 38-45%, France 40-50% (depends on auto-entrepreneur status), Netherlands 40-48%, Spain 30-40%, Italy 35-45%, Portugal 25-35%, Ireland 40-48%, Poland 25-35%. Use your national tax agency's effective-rate figure from last year's return if you have it — otherwise start at the middle of your country's band and tune.

Question 2

How many billable hours should I actually assume?

Accepted Answer

Most freelancers overestimate this and undercharge as a result. A typical working year is ~2,000 hours, but after business development, admin, pitching, invoicing, training, and deep-work planning, genuinely billable time is usually 60-70% of that — 1,200 to 1,400 hours. If you're running a solo consultancy with lots of sales motion, it can drop to 50%. The tool starts from a realistic figure because that's where the rate that actually pays the bills comes from.

Question 3

Should I include pension contributions?

Accepted Answer

If your country's social-security system covers a meaningful state pension (e.g. France, Netherlands), the social-charges rate already includes it — don't double-count. If it doesn't, or the state pension alone won't fund retirement (true for most EU freelancers), add your private pension contribution to expenses. Most financial advisors suggest 10-15% of gross for self-employed.

Question 4

Why is this lower than what agencies charge?

Accepted Answer

Agencies typically mark up 2-3x on top of the freelancer's rate to cover account management, sales, bench time between projects, office overhead, insurance, and margin. Your rate as an independent contractor is the rate the agency would pay a freelancer — not the rate they bill the client. If you're comparing, knock 50-70% off the agency day rate to get the solo-freelance equivalent.

Question 5

What's the difference between the floor rate and the target rate?

Accepted Answer

The floor rate is the break-even number — charge below this and you're subsidising your clients. The target rate is what you should actually pitch: floor plus a buffer (default 20%) for slow months, unexpected expenses, and retirement savings. If you always quote your floor, you're one bad quarter away from a cash-flow problem. Quote the target rate and negotiate down from there if needed — not up.

Question 6

Is this tool free to use?

Accepted Answer

Yes — completely free, no sign-up, no account. TimeIsMoney.tools is supported by minimal, non-intrusive advertising. Nothing you enter leaves your browser.

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