The most common question I get from people going freelance is what to charge. The most common answer given is to check what the market pays. It sounds sensible and it is the worst available method, because it prices you against someone else's guess, and they were usually guessing too.
A rate is not a number you discover. It is a number you calculate, and the calculation is not complicated. It just has three parts that almost everybody leaves out.
Mistake one: counting only the hours you work
If you work a forty hour week, you do not invoice forty hours. Negotiation, writing proposals, calls that never become work, chasing payment and keeping your skills current are all real working time with no invoice attached to them.
The realistic ratio I see is that roughly half the week is billable, and less than that in a first year. So if you want a particular income, you divide it by realistic billable hours, not by the hours in your week.
That single error is why people set a rate at half what they need, then work longer to compensate, which reduces their billable ratio further. It is a loop that ends in exhaustion rather than income.
Mistake two: leaving tax out of the number
You are not an employee. Nobody deducts tax before the money reaches you, which makes the figure in your bank account look larger than it is.
Egypt's personal income tax is banded and progressive, and the current bands are published in PwC's summary of taxes on personal income in Egypt. The first EGP 40,000 is taxed at 0%, then 10% up to 55,000, 15% up to 70,000, 20% up to 200,000, 22.5% up to 400,000, 25% up to 1,200,000, and 27.5% above that. There is also an annual exemption of EGP 20,000.
The practical point is not to memorise the bands. It is to understand that your net is lower than your invoiced total by a share that grows as you grow, so the rate has to be calculated from the net you want rather than from the gross.
Past a certain income there are registration obligations that enter the picture as well. I am not an accountant and will not pretend to detail them, but the people who get caught out by them are the ones who never priced them in.
Mistake three: pricing time instead of outcome
Hourly pricing feels fair and punishes you for getting faster. If experience lets you finish in two days what used to take a week, hourly billing cuts your income as a reward for improving.
The answer is not to raise your hourly rate forever. It is to price the project against what it is worth to the client rather than against what it costs you in hours. That shift takes time and usually starts with one job you try it on.
The bottom-up calculation
- Decide the net annual income you actually want. A real number, not an aspiration.
- Add the tax you would owe in the band that income falls into.
- Add business costs: subscriptions, tools, connectivity, a machine that gets replaced every few years, and learning.
- Divide by realistic billable hours, not by the hours in a year.
- The result is your floor. Any work below it means you are paying for the privilege of doing it.
The first time you run this the number is alarming. That is normal, and it is exactly why most people never run it.
When to raise it
Not when you feel you deserve it. When you have evidence: a waiting list, an unusually high proposal acceptance rate, or documented results from previous work. A very high acceptance rate is a signal that you are cheap, not that you are good.
Raise it on new clients first. Existing clients need notice and a reason, which is a separate conversation handled calmly and not on the same day.
If you are still trying to land the first client, start with how to start freelancing in marketing, and the errors that repeat are collected in first year freelancing mistakes. If the problem is somebody cheaper, how to handle a cheaper competitor covers it without dropping your price, and why we do not take a percentage of ad spend shows how the shape of a pricing model changes the incentives inside it.
The company-facing version of the same problem is worth reading too. BDG Labs sets it out in how to price a B2B service without guessing at the number, and the reasoning transfers directly to a freelancer selling to businesses.
Your rate is not one number
I do not work at a single rate for every situation, and I do not think that is inconsistent. Work carrying more risk, tighter deadlines, or a client who needs a lot of meetings should not cost the same as identical work under normal conditions.
What stays fixed is the floor. There are no exceptions below it, because an exception becomes a precedent quickly and then you are working at a rate you had already rejected.
There is one case where I will go below the usual number: when the work pays in something other than money, such as a case study I can publish or entry into a sector I want. When that happens I say so explicitly at the start, so it does not quietly become the standard price.
How to say the number without flinching
Most of the difficulty is not the figure, it is the delivery. Saying the price and then staying quiet reads as confidence. Saying it and immediately justifying it before anyone objects opens the negotiation yourself.
I prefer to send a rate in writing rather than say it on a call, with what is included and what is not written next to it. Most later disagreements turn out to be about scope rather than about the number.
And when a client says the price is high, the useful question is not how much to come down. It is what they are comparing it to. The answer separates a client whose budget genuinely is smaller from one who is comparing you to something that is not the same service.
The honest limit
The calculation gives you a floor, not a market rate. Your speciality may simply not pay it, and in that case the arithmetic is not wrong. It is telling you that this speciality does not support the income you want, which is a different decision entirely.
I am also not an accountant, and the tax figures above are taken from a published reference and can change. Once your income is meaningful, an hour with an accountant pays for itself several times over, and it is something I personally left far too late.