Salary to Day Rate Calculator
Calculate what day rate you need to charge to match your salary package, including all business costs and contractor premiums.
Moving from a salaried role to contracting? Simply dividing your salary by working days will leave you significantly underpaid. This calculator factors in superannuation, business operating costs, insurance, tax obligations, and the value premiums your specialist skills command — giving you an accurate, market-ready day rate for Australian contracting.
Salary to Day Rate Conversion
Convert your salary package to an equivalent contracting day rate
| Component | Value | Amount | Notes |
|---|---|---|---|
| Your Starting Position | |||
| Base Salary (excluding Super) | $75,000 | Annual salary | |
| Employer Superannuation | % | $9,000 | Standard rate |
| Additional Super | % | $0 | Above standard |
| Additional Benefits | $0 | Car, phone, etc. | |
| Total Package | - | $84,000 | Your total value |
| Working Time | |||
| Hours per week | 40 | Baseline hours | |
| Work Days in Year | 260 | 2,080 | Mon-Fri schedule |
| Annual Leave | 160 | Paid leave | |
| Public Holidays | 80 | Varies by state | |
| Sick Leave | 80 | Paid sick days | |
| Workable Time | 220 | 1,760 | Available for work |
| Base Contract Rate | |||
| Daily Rate (Package ÷ Workable Days) | $382 | $47.73 | Before costs |
| Expected Utilization | |||
| Expected Billable Days | 91% | Realistic target | |
| Business Costs | |||
| PI/PL Insurance | $0.26 | Annual premium | |
| Workers Compensation | % | $1,344 | % of revenue |
| Payroll Tax | % | $4,410 | State dependent |
| Accounting Fees | $2.19 | Annual cost | |
| Business Software | $1.56 | Tools & systems | |
| Equipment & Training | $2.81 | Computer, office, PD | |
| Total Business Costs | $17,674 | $11.04 | Per billable hour |
| Contractor Premium Value | |||
| Risk Premium | % | $4.77 | Downtime risk |
| Technical Skills Premium | % | $9.55 | Expertise value |
| Domain Expertise Premium | % | $7.16 | Industry knowledge |
| Soft Skills Premium | % | $2.39 | Communication, etc. |
| Total Value Add | 50% | $23.86 | Premium per hour |
| Your Contract Rate | |||
| Recommended Day Rate | $661 | $82.63 | All-inclusive rate |
| Gross Income Increase | $48,334 | 57.5% | vs salary package |
Day Rate
Hourly Rate
Income Boost
Rate Breakdown
See how your day rate is composed
Frequently Asked Questions
How do I convert my salary to a day rate?
Divide your total salary package (including superannuation and benefits) by your available working days, then add business costs like insurance, accounting fees and payroll tax. Finally, apply premiums for risk, technical skills and domain expertise to arrive at a competitive contracting day rate.
What business costs should I include in my day rate?
Key costs include Professional Indemnity and Public Liability insurance, workers compensation, payroll tax, accounting fees, business software subscriptions, and equipment and training costs. These are expenses your employer previously covered that you must now fund yourself.
What is a good utilisation rate for contractors?
A realistic target is 85-91% utilisation, which equates to roughly 187-200 billable days per year out of 220 available working days. New contractors should budget conservatively at 75-80% while building their client base.
Why is my day rate so much higher than my salary divided by working days?
A simple salary division ignores the costs your employer covered — superannuation, insurance, leave loading, payroll tax and equipment. It also fails to account for unbillable time between contracts and the risk premium contractors deserve for not having job security.
How much more should a contractor earn than a permanent employee?
Contractors typically need to charge 40-70% more than the equivalent salary rate to cover business costs, self-funded leave, and the inherent risk of contract work. The exact premium depends on your industry, skills and utilisation rate.
How It Works
Enter Your Salary Package
Input your current salary, superannuation, and any additional benefits.
Set Working Time
Configure your working hours, leave entitlements, and expected utilization.
Add Business Costs
Include insurance, taxes, and overhead costs to get your true contract rate.
Salary to Day Rate Guide
Learn how to accurately convert your salary to a competitive day rate that covers all costs.
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