Billable time is smaller than working time
An independent professional cannot invoice every hour spent at work. Marketing, calls, proposals, bookkeeping, research and professional development all consume time. Estimate actual billable capacity first.
For instance, working 40 hours per week for 46 weeks is 1,840 hours. If 40% is nonbillable, billable capacity is 1,104 hours, not 1,840.
Start with annual revenue requirements
Add target personal income and annual overhead such as subscriptions, accounting, insurance and equipment. A $65,000 pretax income goal plus $12,000 overhead requires $77,000 revenue before extra tax or savings assumptions. At 1,100 billable hours, that is $70 per billable hour.
If you explicitly want to reserve a percentage of income for taxes, use a documented assumption once. Do not deduct tax both from the income target and again from revenue without understanding the model.
Test the rate in the real market
A calculated baseline is not proof clients will pay it. Compare with your skills, outcomes and local competition, then test pricing with small engagements. Build a buffer for risk and unpaid invoices. Revisit the figures as utilization changes.
For fixed-fee projects, you still need an internal hourly estimate to avoid accidentally underpricing your time.