Turn a Contractor Rate into Real Take-Home Pay
Convert hourly, daily, weekly, monthly or annual contract pay into gross revenue, business profit, estimated tax, take-home pay and an employee-equivalent rate. Unpaid time and nonbillable hours are modeled explicitly.
NET PAY
Contract income and workload
Contractor earnings result
Contractor pay versus employee pay
An advertised contractor rate is revenue, not take-home pay. Contractors commonly absorb unpaid leave, business administration, equipment, insurance, taxes and retirement funding. The calculator divides take-home pay by all entered working hours—including nonbillable time—to show a practical effective hourly rate.
Employee-equivalent comparison
The comparison asks what employee salary, plus the entered employer-paid benefits and payroll-tax share, would equal the contractor's annual business profit. It subtracts benefits from the comparable employer budget before solving for salary. It is a planning comparison rather than a legal worker-classification test.
Why do billable weeks matter?
Vacation, holidays, illness, business development and gaps between assignments can reduce billable weeks even when you work throughout the year.