This guide is for freelancers and contractors selling time, skills, or outcomes in the UK. It covers day rates, packages, retainers, and the maths that stops you guessing. It is not personalised tax advice—see the disclaimer at the end.
The three prices you actually need
Most freelancers only quote one number. Sharp operators keep three:
| Price | What it is | Why it exists |
|---|---|---|
| Floor | Lowest rate you will accept this quarter | Stops panic discounts |
| Target | What a good week should average | Planning and pipeline |
| Stretch | Premium for rush, niche, or high-risk work | Captures upside without rewriting your brand |
If a client only ever hits your floor, you do not have a client base—you have a discount club.
Start from costs, not vibes
Before market rates, know your loaded monthly cost:
- Rent / housing share you must cover
- Software, insurance, accountancy, phone, travel
- Tax buffer (Income Tax + NI for sole traders; salary/dividend planning if limited—use an accountant for your numbers)
- Unpaid time: admin, sales, learning, sick days
Worked sketch (illustrative only):
- Life + tools + buffer: £3,500 / month you need after costs of delivery
- Billable days you can realistically sell: 12 / month (not 20—sales and admin exist)
- Floor day rate before profit ambition: £3,500 ÷ 12 ≈ £292 / day
If competitors “charge £200/day,” either they have lower costs, unpaid support at home, weaker skills, or they are burning out. Your floor is allowed to be higher.
Day rate vs project price vs retainer
Day rate
Best when scope is fuzzy or the client wants you inside their process.
- Quote in days or half-days, not vague “hours” unless you truly sell hours.
- Define what a day means (e.g. 7.5 hours, response windows, on-site vs remote).
- Rush multipliers: +25–50% for sub-one-week starts is normal when it destroys other plans.
Project (fixed) price
Best when you can define deliverables and acceptance criteria.
- Price the outcome, then reverse into days.
- Add contingency: 15–30% for anything with stakeholders who “just have a few more comments.”
- Payment schedule: deposit 30–50% before work starts; never 100% on delivery for new clients.
Retainer
Best when they need ongoing access, not a one-off artefact.
- Define hours or a service level (e.g. two campaigns per month, 48-hour turnaround).
- Unused hours: expire monthly or roll a small bank—write it down.
- Quarterly review clause: rates rise with scope, not with guilt.
Positioning beats racing to the bottom
Clients rarely buy “the cheapest person who can open Figma / write Python / fix WordPress.” They buy:
- Reduced risk
- Speed
- Specific industry context
- Someone who will say no to bad ideas
Niche premium examples (illustrative):
- Generic web tweaks: crowded, price pressure
- Checkout fixes for Shopify stores doing £50k+/month: fewer freelancers, clearer ROI
- Finance-adjacent ops automation with audit trails: trust premium
Write your offer as: I help [who] achieve [result] without [pain]. Then price the result, not your insecurity.
A simple proposal structure
- Context — what you understood
- Outcomes — what “done” means
- Approach — phases, not a novel
- Timeline — realistic, with dependencies
- Investment — packages if possible (Good / Better / Best)
- Assumptions — what breaks the price
- Next step — deposit invoice + start date
Packages reduce haggle energy. Three options beat one take-it-or-leave-it number.
Discount rules (write these on a sticky note)
- Discount only for clear trade: case study rights, longer commitment, prepaid block, off-peak scheduling.
- Never discount because they “might have more work later.” That work is fictional.
- If they want agency quality at hobby prices, decline. Your silence is a pricing tool.
Raising rates without a melodrama
- New clients: new rate immediately.
- Existing clients: 30–60 days notice, tied to a review of scope.
- Anchor on value delivered (“the process now runs weekly without you”) not “my rent went up.”
Red flags in pricing conversations
- “We don’t have budget but there’s exposure.”
- “Just a quick one” with no written scope.
- Refusal to pay a deposit.
- Six stakeholders, one email thread, zero decision-maker.
- Asking for free samples that are actually the job.
Mini calculators you can reuse
Target monthly revenue:
Target day rate × billable days
Effective hourly (from day rate):
Day rate ÷ hours in your day definition
Project price from estimated days:
Estimated days × target day rate × 1.2 contingency
Run the numbers before the call. People who price live on the phone usually leave money on the table.
Related Jackals guides
Disclaimer
This page is general information for UK freelancers. It is not tax, legal, or financial advice. Thresholds, IR35 status, VAT, and company extraction strategies depend on your facts—use a qualified accountant or adviser for decisions that affect your filings or contracts.