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What is included in a hourly rate in the UK?

Discussion in 'Graphic Design Forum' started by gabbbahey, Apr 20, 2014.

  1. gabbbahey

    gabbbahey New Member

    Hi!

    This is my first post at tho forum, so let me introduce myself a bit:

    I´m a graphic designer situated in Sweden. I´m currently working part time for a client on a hourly basis, study (starting on my MFA this fall) and do some freelance work too.

    On the freelance side of my business I´ve recently started working for a UK-based client. And when I´m now about to calculate the fee for the first job, I realize I don´t know anything about how much these kind of services cost in the UK...

    I´ve done some googling, and it seems like, considering my experience (BA in graphic design and 8 years of experience working as an Art Worker, an Art Director and Graphic Designer), I could charge something like £20-30 an hour?

    But what does this mean? I´ve got a hard time to translate this amount to what would charge as a freelance in Sweden.

    I´ll give you an example:

    Lowest recommended hourly rate for a graphic designer in Sweden (based on recommendation of the swedish graphic designers association) is 700SEK, which translates to £63. (VAT not included)

    Sounds quite high... But, considering that (and i´ll be doing some really rough maths here...) tax, employer contributions, etc almost "steals" 40% of that sum, you've got about £36 left. And that money is supposed to cover mortgages, rent and insurance. Not much left for the actual salary...

    I know that I can't apply this calculation to the UK, taxes etc are higher in Sweden for example...

    What I really want to know is how I set a rate that won't scare my customer off, but still will give me a decent income since I´ll be still paying the tax in Sweden, since this is where Im situated.

    So I guess my question is: If I would say my hourly are is £25 (for example) what is included in that price? Just the rate? VAT is on top of that?

    Also really curious how you cover all the costs of running your own company. When I´m employed (doing part time, payed by the hour) I get payed about £20. But that is my salary (well I have to pay taxes of course) But none of the costs that comes with running a company...

    I´m not sure this post makes any sense, but I guess I´m after some help to understand how it works when being a freelancing graphic designer in the uk. I find the "how much to charge-problem" very complicated now when the world gets smaller and smaller because of all the benefits of internet, e-mail and Skype...

    All help / advice welcome, thanks!

    best
    G
     
  2. Opus

    Opus Member

    If you were freelancing in house for a larger design agency you're probably about right saying £20 to £30 per hour (it's a good few years since I've done that type of work so but I don't think it's changed too much. I was working mainly in Manchester/Cheshire - there may be regional variation).

    If you're working with the end client directly you may well be charging significantly more - that rate depends on all those factors you mentioned. I'm not sure on averages but I think £40 / £50 per hour or so is not uncommon. £63 may not be unreasonable depending on the quality of your work and the amount of time you'd allow. VAT would be on top of that but everything else would be part of your calculation.

    Quote based on a rate that is profitable for you. If you lose the client because it is expensive compared to UK based designers then so be it. It wouldn't do you any good to be doing work at a loss.

    I'd be tempted to quote the project fee rather than the hourly rate though - that way everyone knows where they stand. State what you'd be doing and the amount you'd charge for it. If the spec changes, so does the fee, but it's clearer than an hourly rate where the client may have no idea about the length of time a job will take.

    I'm not sure what the VAT rules are given that you're based abroad. VAT registration is not compulsory in the UK (below a £81k annual turnover I think) and I'm assuming that you wouldn't be registering for UK VAT anyway - I suggest you look into it or seek advice.
     
  3. gabbbahey

    gabbbahey New Member

    Thanks! This is of great help!

    And you are probably right, in my case it´s probably best to quote the project fee.

    But once again thanks, this helps me understand if I´m expensive compared to an uk based designer. (which I realize I probably are, I really need to think this over...)
     
  4. gabbbahey

    gabbbahey New Member

    Hi! Haven't worked in the UK for a while, so bringing this one up again... Being up to date on how much to charge in Sweden, but not what is in the UK. I'm working with the end client directly. Are going to design identity and the application of it through posters, flyers, webpage. Etc etc. All together it will probably be about a month of work. I will probably quote a fee for the entire project and break it up for the different parts of the projects. But in order to know about how big the fee would be it would be great to know how much my estimated hours spent would cost in the uk. Would a £50 per hour be somewhat a normal price for this sort of work? cheers G
     

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