How to Work out Your Day Rate

PDF download Download Article
PDF download Download Article

A day rate is the amount of gross income you make per day based on a contract or salary. It is an important figure to calculate if you are considering switching jobs, writing a salary history or calculating a proposal. In order to calculate your day rate, you will need to gather your tax, salary or contract documents. You can figure out your day rate manually with a calendar and a calculator. You can compare these daily rates to other jobs or average daily rates in your field. This article will tell you how to work out your day rate.

Steps

PDF download Download Article
  1. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/2\/2a\/Work-out-Your-Day-Rate-Step-1.jpg\/v4-460px-Work-out-Your-Day-Rate-Step-1.jpg","bigUrl":"\/images\/thumb\/2\/2a\/Work-out-Your-Day-Rate-Step-1.jpg\/aid1770549-v4-728px-Work-out-Your-Day-Rate-Step-1.jpg","smallWidth":460,"smallHeight":306,"bigWidth":728,"bigHeight":485,"licensing":"<div class=\"mw-parser-output\"><p>License: <a target=\"_blank\" rel=\"nofollow noreferrer noopener\" class=\"external text\" href=\"https:\/\/creativecommons.org\/licenses\/by-nc-sa\/3.0\/\">Creative Commons<\/a><br>\n<\/p><p><br \/>\n<\/p><\/div>"}
    This can include your pay stubs, tax documents and/or signed contracts.
  2. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/e\/e1\/Work-out-Your-Day-Rate-Step-2.jpg\/v4-460px-Work-out-Your-Day-Rate-Step-2.jpg","bigUrl":"\/images\/thumb\/e\/e1\/Work-out-Your-Day-Rate-Step-2.jpg\/aid1770549-v4-728px-Work-out-Your-Day-Rate-Step-2.jpg","smallWidth":460,"smallHeight":345,"bigWidth":728,"bigHeight":546,"licensing":"<div class=\"mw-parser-output\"><p>License: <a target=\"_blank\" rel=\"nofollow noreferrer noopener\" class=\"external text\" href=\"https:\/\/creativecommons.org\/licenses\/by-nc-sa\/3.0\/\">Creative Commons<\/a><br>\n<\/p><p><br \/>\n<\/p><\/div>"}
    Remember to include commission, if that is part of your yearly salary. Generally, a day rate is calculated according to the gross income, and it does not factor in taxes, 401 K contributions or medical savings accounts.
    • Taxes vary from state to state and country to country. If you are attempting to figure out how your daily rate competes against a national or state average, it is especially important to work with gross salary rates.
    Advertisement
  3. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/d\/d4\/Work-out-Your-Day-Rate-Step-3.jpg\/v4-460px-Work-out-Your-Day-Rate-Step-3.jpg","bigUrl":"\/images\/thumb\/d\/d4\/Work-out-Your-Day-Rate-Step-3.jpg\/aid1770549-v4-728px-Work-out-Your-Day-Rate-Step-3.jpg","smallWidth":460,"smallHeight":306,"bigWidth":728,"bigHeight":485,"licensing":"<div class=\"mw-parser-output\"><p>License: <a target=\"_blank\" rel=\"nofollow noreferrer noopener\" class=\"external text\" href=\"https:\/\/creativecommons.org\/licenses\/by-nc-sa\/3.0\/\">Creative Commons<\/a><br>\n<\/p><p><br \/>\n<\/p><\/div>"}
    For a standard, 5-day, work week and salaried job, you would multiply 5 times 52, the number of weeks in the year. Modify the result, 260, based on any un-paid work days.
  4. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/6\/68\/Work-out-Your-Day-Rate-Step-4.jpg\/v4-460px-Work-out-Your-Day-Rate-Step-4.jpg","bigUrl":"\/images\/thumb\/6\/68\/Work-out-Your-Day-Rate-Step-4.jpg\/aid1770549-v4-728px-Work-out-Your-Day-Rate-Step-4.jpg","smallWidth":460,"smallHeight":306,"bigWidth":728,"bigHeight":485,"licensing":"<div class=\"mw-parser-output\"><p>License: <a target=\"_blank\" rel=\"nofollow noreferrer noopener\" class=\"external text\" href=\"https:\/\/creativecommons.org\/licenses\/by-nc-sa\/3.0\/\">Creative Commons<\/a><br>\n<\/p><p><br \/>\n<\/p><\/div>"}
    For example, if you received $45,000 and worked 260 days, your day rate would be $173 per day.
    • Imagine you are working as a freelancer and you were paid $7,000 for a project that lasted 3 months. If you worked 5 days per week, you would multiply 5 times 12 (weeks) to get 60 total working days. Divide $7,000 by 60 to get your $116.67 day rate.
  5. {"smallUrl":"https:\/\/www.wikihow.com\/images\/thumb\/a\/a4\/Work-out-Your-Day-Rate-Step-5.jpg\/v4-460px-Work-out-Your-Day-Rate-Step-5.jpg","bigUrl":"\/images\/thumb\/a\/a4\/Work-out-Your-Day-Rate-Step-5.jpg\/aid1770549-v4-728px-Work-out-Your-Day-Rate-Step-5.jpg","smallWidth":460,"smallHeight":306,"bigWidth":728,"bigHeight":485,"licensing":"<div class=\"mw-parser-output\"><p>License: <a target=\"_blank\" rel=\"nofollow noreferrer noopener\" class=\"external text\" href=\"https:\/\/creativecommons.org\/licenses\/by-nc-sa\/3.0\/\">Creative Commons<\/a><br>\n<\/p><p><br \/>\n<\/p><\/div>"}
    6. Advertisement


Community Q&A

Search
Add New Question
  • Question
    Do I have to set myself up as a limited company to be a day rate contractor?
    Community Answer
    Not necessarily. It depends how you want to conduct your tax affairs and the requirements of those who hire you. In the UK (and many other EU countries) you could do this as a sole trader, which is simplest. In the US, the equivalent is sole proprietor.
    Thanks! We're glad this was helpful.
    Thank you for your feedback.
    If wikiHow has helped you, please consider a small contribution to support us in helping more readers like you. We’re committed to providing the world with free how-to resources, and even $1 helps us in our mission. Support wikiHow
    Yes No
    Not Helpful 0 Helpful 6
Ask a Question
200 characters left
Include your email address to get a message when this question is answered.
Submit
      Advertisement

      Tips

      • You can also go online to try to work out your daily or hourly rate. Some sites, such as nyc.gov/site/opa/my-pay/pay-rate-calculator.page and us.thesalarycalculator.co.uk/hourly.php provide a pay rate calculator.
        Thanks
        Helpful 0 Not Helpful 0
      • If you already know your hourly pay rate, then multiply it by the hours you work per day to find out your day rate.
        Thanks
        Helpful 0 Not Helpful 0
      • If you need to calculate day rates for a proposal, then you should begin by calculating your costs, researching average salaries for the work you are doing and taking into account your salary history. Freelanceswitch.com/rates can help you to calculate your hourly and daily rate.
        Thanks
        Helpful 0 Not Helpful 0
      Submit a Tip
      All tip submissions are carefully reviewed before being published
      Name
      Please provide your name and last initial
      Submit
      Thanks for submitting a tip for review!
      Advertisement

      Things You'll Need

      • Payment slips
      • Calculator
      • Tax documents
      • Calendar
      • Daily rate calculator (optional)

      You Might Also Like

      3 Ways to Determine Your Annual Income & Market Value
      How to
      Verify Cash App: Identity, Account, Bitcoin, & More
      How To Find Your Hourly Rate (When You’re Paid by Salary)
      How to
      Write a Letter for Proof of Income
      How to
      Work Out Salary Increase Percentage
      How to
      Write a Compensation Proposal
      How to
      Increase Your Income
      How to
      Read a Pay Check Stub
      How to
      Calculate Net Income
      How to
      View Pay Stubs on ProLiant
      Advertisement

      References

      1. http://www.usnh.edu/banner/cheat-sheets/active/CalcDailyRateSalaryEmpl.pdf
      2. http://www1.nyc.gov/site/opa/my-pay/pay-rate-calculator.page

      About This Article

      In other languages
      Thanks to all authors for creating a page that has been read 120,428 times.

      Did this article help you?

      Advertisement