How Much Should Freelancers Charge? Hourly and Project Rates

“How much should I charge for my services?” As a Chartered Professional Accountant (CPA), this is the question I hear most often from freelancer clients. Pricing is a delicate balance: you don’t want to drive away clients with rates that are too high, nor do you want to undervalue your work. The process can be confusing even for seasoned freelancers, so this guide walks through practical steps to set rates that reflect the market, cover your needs and expenses, and allow you to grow your business.

Deciding what to charge involves three main steps: researching the market you operate in, assessing your personal income needs and business break-even point, and selecting a pricing approach—cost-based or value-based. Each plays a role in finding a sustainable, competitive rate.

1. Understanding the market

Start by researching your market to understand where you fit and what clients expect to pay. Focus on these areas:

Competitors: Identify other businesses or freelancers offering similar services in your industry or region. Note their offerings, experience level and target clients.
Customers: Determine who your competitors serve. What types of clients buy their services, and what problems are they solving?
Pricing: Observe whether competitors charge hourly or per project. Consider why their prices differ—is it specialization, reputation, bundled services, or deliberate low pricing to attract clients?

Use this research as a benchmark. A simple S.W.O.T. analysis (Strengths, Weaknesses, Opportunities, Threats) can help you compare your services and identify where you can compete—on price, specialization, speed or added value. For example, a freelance event photographer who offers only photography (no video) should generally price lower than peers who bundle photo and video; that price difference may help attract budget-conscious clients while leaving room to expand services later.

After research, you should be able to answer:

What are typical rates in your industry?
Will you charge hourly, per project, or offer both?
What services will project packages include?
Will you create tiered packages or bundles that reflect different value levels?

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How much to invoice as a freelancer

To determine the dollar amount to charge, combine a personal needs assessment with a clear accounting of business expenses. These two components yield your break-even target and a basis for hourly or project pricing.

1. Personal needs assessment

Estimate the income you need to cover essentials (rent, utilities, groceries) and discretionary spending. Factor in taxes: many new freelancers forget that take-home pay must cover tax obligations. For example, if you need $1,000 per month after taxes and expect to be roughly in a 30% income tax bracket, you’ll need to withdraw about $1,300 from the business to net $1,000.

Decide how many hours per week you can realistically work and include non-billable time for administration, marketing and client management. Divide the monthly amount you need by the billable hours you plan to work per month to calculate a minimum hourly rate. That minimum becomes a baseline for pricing decisions.

2. Business expenses

List fixed monthly business expenses—rent, supplies, software, subscriptions, banking fees—and variable costs. These feed into your break-even analysis. For example, if your fixed business expenses are $500 per month and you need $1,300 personally, your business must generate $1,800 each month to cover both.

$1,300 (personal payout) + $500 (business expenses) = $1,800 per month

$1,800 divided by 20 billable hours per month = $90 per hour

This $90 is a break-even hourly rate; to grow, reinvest or hire help, you’ll want to add a profit margin. For project-based pricing, estimate how many hours a project takes and multiply by an appropriate hourly rate that includes profit.

Setting your price: cost vs. value pricing

Two main approaches guide pricing: cost-based and value-based.

Cost-based pricing: Calculate costs, add overhead margins and include a profit percentage. This straightforward method works well for commodity-like services or product-based offerings, and can be applied hourly or per project. It ensures costs are covered and a target profit is achieved.
Value-based pricing: Price based on the benefit your work delivers to the client and how much they are willing to pay for that outcome. This method is often applied to specialized or strategic services where your expertise directly impacts the client’s results. Because it focuses on client-perceived value, you must still ensure the fee covers the hours invested and yields profit.

Cost-based pricing is common where price competition is intense. Value-based pricing is better suited to high-value work—strategy, niche expertise or measurable business improvement—where clients are willing to pay a premium. Choose the approach that aligns with your strengths, market positioning and client expectations.

Compare your price to the market

Once you have your rates, compare them to market research. Are your rates realistic given demand and competition? If your break-even rate is above what clients typically pay, you may need to adjust hours, reduce costs, reposition your offering, or target a different client segment that values your skills more highly.

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Freelancers and taxes, CPP and EI

Taxes and mandated contributions are essential to include in pricing plans. Two key tax considerations are sales tax and income tax; additionally, as a self-employed person you must consider Canada Pension Plan (CPP) contributions and whether to opt into Employment Insurance (EI).

Sales tax

Goods and Services Tax (GST) and Harmonized Sales Tax (HST) are charged on top of your prices and vary based on the customer’s location. You must register for a GST/HST number once taxable sales exceed the registration threshold. There are pros and cons to registering before you reach that threshold, so discuss timing with an accountant.

Income tax

Your business structure—sole proprietor, partnership or corporation—affects how taxes are filed. Factor expected income tax into your personal needs assessment so your take-home pay meets your living costs.

CPP contributions

If you’re self-employed, you generally must make Canada Pension Plan contributions unless your net earnings are below the minimum threshold. Self-employed individuals pay both the employee and employer portions; set aside funds throughout the year to cover this liability.

Employment insurance (EI)

Freelancers can choose to opt into EI special benefits for self-employed people, but enrollment is voluntary and, once elected, cannot be reversed immediately. Consult an accountant to weigh the benefits and costs for your situation.

How much to charge depends on your skills, market and income needs

Pricing is part analysis and part judgment. Many variables affect what you should charge: market demand, your experience, the perceived value you deliver, and your personal and business financial needs. Have confidence in your expertise and package your services and messaging to attract clients who see the value you provide. Some clients will consider you too expensive—and that’s okay; they may not be your ideal customers.