How Much Should a Tradie Charge Per Hour in Australia?

Most tradies set their hourly rate by asking a mate what he charges, adding ten dollars and hoping. That's how you end up flat out for twelve months and still short at tax time. Your charge-out rate isn't a market price you copy, it's an output. Feed in your overheads, the hours you can genuinely bill, what you need to earn and the margin you want left over, and the number falls out the other end. Here's the arithmetic, with a full worked example. All figures are AUD and exclude GST unless stated.

Stop copying the bloke down the road

Lifting a competitor's rate imports his cost base into your business, and you have no idea what it is. He might have a paid-off ute, a partner doing the books for nothing and no rent to cover. He might be going backwards. A published rate tells you what someone is willing to say out loud, not whether it covers their super, their insurance, or the three hours a week they lose at the supplier. Build your own number first, then decide whether you can defend the difference.

Step 1: work out your real billable hours

This is where most rates break, because you don't get paid for 40 hours a week. Start with 52 weeks. Take out four weeks of annual leave and roughly two weeks of public holidays and sick days, and you have 46 working weeks. At 40 hours, that's 1,840 hours a year on the clock. Now subtract everything you can't put on an invoice: quoting, site visits that don't convert, ordering and pick-ups, travel between jobs, invoicing, chasing money, servicing the van, doing the BAS. Don't estimate this, log it for a month. The example below assumes 40% non-billable, roughly a day and a half a week of unpaid work, leaving about 1,100 billable hours. If your tracking says 30%, use 1,290 hours. If it says 50%, use 920. Overstating them underprices every job you quote all year.

Step 2: total your overheads for the year

Every dollar that isn't charged to a specific job comes back out of your rate. Pull last year's profit and loss and list them, ex GST: - Vehicle (repayments or depreciation, fuel, rego, insurance, servicing, tyres): $14,000 - Public liability and tool insurance: $1,200 - Income protection: $1,800 - Licences, registrations and association fees: $600 - Phone and internet: $1,800 - Job management and accounting software: $1,500 - Accountant and bookkeeper: $2,500 - Tool replacement and depreciation: $4,000 - Unbilled consumables (screws, tape, silicone, blades): $1,500 - Marketing, website and ads: $3,000 - Workwear, PPE, training and CPD: $1,200 - Bank and merchant fees: $800 Total: $33,900 a year. Use your own figures; the point is the checklist, not the amounts. Two traps: don't double-count materials you already on-charge to jobs, and remember tools above the current instant asset write-off threshold are depreciated over several years, not claimed outright. That threshold changes, so confirm it first.

Step 3: pay yourself properly, including super

Your wage is not what's left over. It's a cost, and it goes into the rate before profit. Pick a real number: what you'd have to pay somebody to do your job, plus something for carrying the risk, the debt and the after-hours phone. Say $95,000. As a sole trader you don't draw a wage in the payroll sense and you aren't obliged to pay yourself the Super Guarantee. Fund it anyway. The Super Guarantee for employees has been 12% since 1 July 2025, so use the same rate on yourself: $95,000 x 12% = $11,400 a year, about $219 a week. Personal contributions are generally tax-deductible if you lodge a notice of intent with your fund and stay inside the annual concessional cap, so check the current cap on ato.gov.au. Income target $95,000 + super $11,400 = $106,400.

Step 4: do the sum

Add the two halves and divide by billable hours. Overheads: $33,900 Income plus super: $106,400 Total cost of the year: $140,300 Billable hours: 1,100 Break-even rate: $140,300 divided by 1,100 = $127.55 an hour ex GST. That's break-even with your income already inside it. Every hour billed under $127.55 costs you money, however busy the week looked. Now add margin. Margin isn't your wage. It's the buffer for the quotes you get wrong, the warranty callbacks, the 90-day payer, the quiet fortnight in July and replacing the ute without borrowing. At 15%: $140,300 divided by 0.85 = $165,059 $165,059 divided by 1,100 = $150.05 Call it $150 an hour ex GST, or $165 including GST.

Margin and markup are not the same thing

Fifteen per cent added on top is not a 15% margin. Multiply $140,300 by 1.15 and you get $161,345, which is a 15% markup and leaves a 13% margin. Divide by 0.85 instead and you get $165,059, a genuine 15%. The gap is $3,714 a year, or $3.38 an hour, for the same work. The same trap sits in your materials pricing. A 25% markup on cost is a 20% margin. A 50% markup is a 33% margin. For a target margin, divide by (1 minus the margin). For a markup, multiply. Pick one, write it down and apply it consistently to labour and materials. Mixing them is how a job that looked healthy on the quote comes out flat.

What to charge out an employee

Your second tradesperson is where profit lives, but only if you cost them properly. Take a qualified tradie on $75,000, about $37.96 an hour across a 38-hour week. Base wage: $75,000 Super at 12%: $9,000 Workers compensation (say 4%): $3,000 PPE, phone, training, licences: $3,000 Total: $90,000 Workers compensation rates vary by state and trade classification, so get a real quote. Their billable share beats yours because they don't quote or invoice, but still falls short of paid hours: 44.5 weeks x 38 hours = 1,691 paid, at roughly 80% billable = 1,350 hours, so $66.67 an hour. Add the overheads they bring (second vehicle, extra insurance, another software seat, say $18,000) and you're at $80 before a cent of profit. Charge them at your $150 and the gap is $70 an hour. Payroll tax starts only once total wages pass your state or territory threshold, so check your revenue office.

Materials, travel, minimums and after hours

Your hourly rate is only half the invoice. Materials: mark up the ex-GST cost price. Sourcing, collecting and warranting gear is unpaid labour, and the markup pays for it. On $400 of cable at 25% markup you bill $500 ex GST. Keep every supplier docket tied to its job line. Taskr scans receipts and links the cost straight to the job line, so you see real materials margin per job instead of guessing at quarter's end. Travel: either bill it (first 30 minutes free, then charged) or accept it sits inside the 40% non-billable you priced in. Minimum charge: a call-out fee or one-hour minimum stops a 20-minute fault find costing you an hour of driving. After hours: apply a loading, commonly 1.5x evenings and weekends, 2x public holidays, stated on the quote before you attend.

GST, your ABN and how to present the number

Register for GST once your business turnover reaches $75,000 in a 12-month period, or as soon as you expect it to. You have 21 days from that point to register. From then, every invoice carries 10% GST and you claim credits back on business purchases. GST is a pass-through, not income, so never let it pad out the rate in your own head. Present the number the way the customer thinks. Homeowners compare inc-GST prices, so lead with $165 an hour including GST. Builders and commercial clients work ex GST because they claim the credit, so quote them $150 plus GST. Same rate, two audiences. Put your ABN on every quote and invoice. Without it, a business customer is generally required to withhold 47% of the payment and send it to the ATO.

Test the rate, then check it against every job

A rate you can't defend is a rate you'll discount. Run three checks. First, does it survive a bad year? At 800 billable hours instead of 1,100, $150 an hour returns $120,000, covering the $33,900 of overheads and most of your income target. Second, sanity-check the market: published rates in your area, and the reason given every time you lose a quote. Third, compare quoted hours against actual hours on your last ten jobs. That's the only real test of whether the rate holds. Taskr's job costing puts quoted hours, logged time, materials and supplier receipts on one page, so you find out which jobs made money while you can still do something about it. Review the number yearly, and immediately whenever insurance, fuel or a wage moves.