Consulting Fees Calculator

Formula

Pre-tax invoice = billable hours × contracted hourly rate + agreed pass-through costs.

Worked example

With Billable hours: 25 hours, Agreed hourly rate: 120 currency units/hour, Approved pass-through costs: 200 currency units, estimated invoice before tax is 3,200.00 currency units.

Inputs and calculation

Multiply time that can actually be invoiced by the agreed rate, then add reimbursable items accepted under the engagement. The labor-only output helps distinguish service revenue from cost reimbursement. The displayed relationship is Pre-tax invoice = billable hours × contracted hourly rate + agreed pass-through costs. Keep the fields' displayed units attached when reproducing this relationship by hand.

Worked numerical example

For example, enter billable hours 25 hours, agreed hourly rate 120 currency units/hour, approved pass-through costs 200 currency units. Those inputs produce estimated invoice before tax of 3,200 currency units. The same values also give service labor amount 3,000 currency units.

Holding the other example values fixed, change billable hours from 25 to 27.5 hours. The main output becomes 3,500 currency units. This comparison isolates the effect of that one input.

How to read and use the result

The result estimates an invoice, not the consultant's profit or take-home pay. Nonbillable preparation, software, insurance and business taxes remain business costs. Draft a transparent fee estimate for hourly consulting work.

Practical context

Twenty-five billable hours at 120 produce 3,000 in labor fees; adding 200 of approved pass-through costs yields a 3,200 pre-tax invoice estimate. If the consultant spent another ten hours on unpaid proposals and administration, that time lowers effective earnings but does not automatically belong on this client's invoice.

Assumptions and scope

Hours and rate follow the contract's billing increments, and the pass-through amount is chargeable to the client. Tax, discounts and retainers are not applied. Replace the example defaults with measured inputs for your situation and account separately for factors outside these fields.

Checks and common mistakes

Do not bill every hour spent when the agreement caps hours or requires approval. Confirm whether expenses are billed at cost, marked up, or included in the quoted rate.

Common questions

What should I verify before using the Consulting Fees Calculator result?

A fixed-fee project requires a different pricing decision: estimated hours are internal cost assumptions while the client pays an agreed scope price. State billing increments and expense treatment in the contract.