Setting your hourly rate as a self-employed worker: the simple method
The client is on the front step, arms crossed: "So, how much an hour?" You say $35, because it's a bit more than you made at your old boss's. By March, you're wondering where the money went. Here's a five-step grid to find a rate that truly pays for your life, your tools and your weeks without contracts.
Why your hourly rate isn't your old wage
As an employee, your employer paid for things you never saw: their share of your contributions, your vacation, your statutory holidays, your equipment, the truck. On your own, all of that comes out of your pocket. And every hour spent preparing a quote, buying supplies or driving between two clients can't be billed.
- For the Québec Pension Plan (QPP), you pay both shares: 12.6% on earnings between $3,500 and $74,600 in 2026, according to Retraite Québec.
- For the Québec Parental Insurance Plan (QPIP), your self-employed rate is 0.764% in 2026, compared with 0.430% for an employee.
- No paid vacation or paid holidays: when you don't work, you don't bill.
- According to Retraite Québec, self-employed workers generally don't have access to Employment Insurance; it recommends an emergency fund covering a few months of expenses.
- CNESST coverage for workplace accidents isn't automatic: personal coverage is optional, and it has a cost.
In short, if you bill your old hourly wage, you're paying yourself less than before. The start-up steps (registration, taxes, insurance) are covered in Becoming self-employed in Quebec: the steps from A to Z.
Do it today: pull out your last RL-1 slip or pay stub and write down your gross annual salary. That's your benchmark.
Steps 1 to 3: your target income, your charges and your expenses
Step 1, target income. This is the gross annual salary you need, as if you were an employee. Not a dream, not the bare minimum: an amount you can live on and still save a little.
Step 2, the charges an employer used to pay. The main one is the "employer" share of the QPP: 6.3% of your earnings above $3,500, up to $74,600 (half of 12.6%). Add the QPIP difference (0.334% of your income) and your insurance: liability, disability, and CNESST personal coverage if you take it. For that coverage, the amount you choose falls between $34,700 and $103,000, and the CNESST can estimate the premium for you.
Step 3, the year's expenses. Check what applies:
- Vehicle, for the work portion: payments, fuel, insurance, maintenance.
- Tools and equipment, including their replacement.
- Products and supplies you don't bill back to the client.
- Cellphone, invoicing software, accountant.
- Advertising, business cards, website.
- Training, cards and permits, workwear and protective equipment.
Do it today: open a spreadsheet and enter these three amounts. For expenses, start from your actual statements for the last 12 months if you have them.
Step 4: count your truly billable hours
This is the step almost everyone skips, and it's the one that changes the result the most. A year has 52 weeks, but you'll never bill 52.
| Line | Example |
|---|---|
| Weeks in the year | 52 |
| Minus vacation | 4 |
| Minus statutory holidays (approx.) | 2 |
| Minus sick days and the unexpected | 1 |
| Minus your trade's off-season | 0 in this example |
| = Weeks worked | 45 |
| × Working hours per week | 35 |
| × Billable share | 75% |
| = Billable hours | 1,181 |
The billable share is the time at the client's place or on the job site, the time you can put on the invoice. The rest (quotes, travel, purchasing, invoicing, calls, truck maintenance) is real work, but nobody pays for it directly. A painter who writes three quotes a week feels it.
The off-season counts too. A landscaper with no winter contracts, or a painter who doesn't do exteriors from December to March, has to remove those weeks from the calculation, or their rate will be too low all year.
Do it today: for two weeks, write down every evening your billed hours and your unbilled hours. You'll have your real billable share instead of a guess.
Step 5: the calculation, the margin and the taxes
The formula fits on one line:
Hourly rate = (target income + charges + expenses) ÷ billable hours, then add a margin for the unexpected.
The margin covers what you don't see coming: a client who pays late, a snowblower that breaks down, a slow month. In our examples, we use 10%. You can aim higher; what matters is never setting it to zero.
Taxes aren't part of your rate: they're added on the invoice. As long as your taxable supplies don't exceed $30,000 in a calendar quarter or over the four preceding calendar quarters, you're a "small supplier," according to Revenu Québec. Beyond that, you must register and add the GST (5%) and the QST (9.975%), both calculated on the same price. At $48 an hour, that's $2.40 of GST and $4.79 of QST, for $55.19 billed. That money isn't yours. The details are in GST and QST: when must a self-employed worker register?.
Think about income tax too. Revenu Québec requires instalment payments if your net income tax payable is over $1,800 for the current year and for either of the two previous years. For a calculation suited to your situation, talk to an accountant.
Do it today: open a second bank account just for taxes and income tax, and transfer part of every payment you receive into it.
Three examples in service trades
The amounts below are assumptions to illustrate the method, not market averages. Replace them with your real numbers.
| Residential cleaning | Residential painting | Grounds maintenance and snow removal | |
|---|---|---|---|
| Target income | $40,000 | $55,000 | $50,000 |
| Charges (QPP, QPIP, insurance) | $3,933 | $5,428 | $5,597 |
| Expenses | $7,500 (car, products) | $14,000 (van, ladders, tools) | $20,000 (tractor, snowblower, trailer, fuel) |
| Total to cover | $51,433 | $74,428 | $75,597 |
| Billable hours | 45 wks × 35 h × 75% = 1,181 h | 40 wks × 40 h × 70% = 1,120 h | 42 wks × 40 h × 65% = 1,092 h |
| Base rate | $43.55 | $66.45 | $69.23 |
| With a 10% margin | about $48 | about $73 | about $76 |
Cleaning needs little equipment, but a lot of driving between clients. The painter loses weeks in winter and spends time on quotes; paint is billed separately and shouldn't hide inside the hourly rate. In grounds maintenance and snow removal, it's the tractor that pushes the rate up, not greed.
In snow removal, you rarely sell by the hour: you sell a seasonal contract. Convert. If a driveway takes you 25 minutes per visit, travel included, and you expect 30 visits, that's 12.5 hours × $76, or $950 for the season, before taxes. Your records from past winters are your best data.
Do it today: redo the table with your numbers. If your rate comes out well above what's being asked in your region, review your billable hours and expenses before cutting your target income.
From hourly rate to quote
Your rate is your floor, not necessarily the price you advertise. For a quote, estimate the hours, multiply by your rate, add materials and out-of-area travel, then round. The client sees a clear price; you know it covers everything.
On GPP Emploi, turn on "Contracts on my own account" in your profile and answer requests for quotes with your price. The contract is signed on the platform and you deliver in stages: after each delivered stage, the client has 72 hours to accept or dispute it; with no answer, it's accepted automatically. Protected payment isn't offered yet: the client pays you directly, according to the signed payment schedule. So split your stages so money comes in at the pace of your expenses, for example "prep and primer," then "two finish coats." The 5% connection fee is paid by the client at signing. Everything is explained on the self-employed workers page.
To write your quotes faster without cutting corners, read Writing quotes with AI: saving time without losing accuracy.
Do it today: create your self-employed profile and build a quote template with your rate, your travel fees and your standard payment schedule.
The bottom line
Your hourly rate is what your life and your business need, divided by your truly billable hours. Redo the calculation every year, or as soon as your expenses change, and raise your price before you're forced to.
Frequently asked questions
How do you calculate a self-employed hourly rate?
Add up your target income, the charges an employer used to pay (the employer share of the QPP, insurance) and your business expenses for the year. Divide the total by your truly billable hours, then add a margin for the unexpected. Taxes are then added on the invoice.
How many billable hours are there in a self-employed year?
It depends on your trade, your season and the time spent on travel and quotes. In this article's example, 45 weeks of 35 hours with a 75% billable share gives about 1,180 hours. Measure your own billable share for two weeks to get a reliable figure.
Do I have to charge GST and QST?
If your taxable supplies exceed $30,000 in a calendar quarter or over the four preceding calendar quarters, you're no longer a small supplier and you must register. You then add the 5% GST and the 9.975% QST to your invoices. Below that threshold, registration is voluntary; Revenu Québec explains the special cases.
How much does a self-employed worker pay into the QPP?
In 2026, you pay both shares: 12.6% on earnings between $3,500 and $74,600, according to Retraite Québec, plus an additional contribution on earnings between $74,600 and $85,000. Rates and ceilings change every year.
Are self-employed workers entitled to Employment Insurance?
Generally, they don't have access to regular benefits. They can register for certain federal special benefits, such as sickness or family caregiver benefits; in Quebec, maternity and parental benefits fall under the QPIP. That's why an emergency fund matters.
Sources
- How to organize your finances when you are self-employed? - Retraite Québec
- Québec Pension Plan Figures - Retraite Québec
- Taux de cotisations au Régime québécois d'assurance parentale (RQAP)
- Protection personnelle
- Details Concerning Small Suppliers
- Calcul des taxes
- Instalment Payments
- Benefits for self-employed people - Canada.ca