What hourly freelance rate could replace my salary?

Your freelance rate should cover more than the salary you want to replace. It should also account for unpaid administrative time, vacation, benefits, business expenses, self-employed CPP/QPP contributions, taxes and a profit or risk margin.

Start with the annual compensation you want to replace, add employer-paid benefits and business overhead, then divide by realistic billable hours rather than all working hours. Freelancers usually cannot bill every hour they work.

There is no universal number. The realistic total should exclude vacation, holidays, sick time, sales, administration, bookkeeping and other non-billable work, which is why using 2,080 billable hours often understates the required rate.

Usually, yes. Employees often receive paid vacation, employer payroll contributions, equipment and benefits that a self-employed person must finance directly, while freelancers also carry business and income volatility risk.

The appropriate amount depends on net business income, province, deductions and other income. A percentage reserve can help with cash flow, but a self-employed tax calculation is more accurate than using one fixed rule for everyone.