Most freelancers get pricing wrong on day one — not because they're bad at their craft, but because they price like an employee instead of a business owner. They take the salary they wish they earned, divide it by working hours, and call that their rate. The problem is nobody covers their sick days, nobody matches their social security contribution, and nobody pays them for the hours spent writing quotes or chasing a client who hasn't paid yet.
This piece walks through how to price freelance work properly: the hidden costs that need to live inside your rate, a step-by-step formula for calculating it, and how to raise prices with existing clients without losing them.
Why Freelancers Get Pricing Wrong From the Start
The classic mistake comes from two bad sources. The first is a former employee salary, divided by a standard 8-hour day and converted into a day rate. The catch is that an employee salary quietly includes benefits, social security, paid leave, and paid time that isn't spent facing a client. When a freelancer copies that same number, they end up working for free to cover costs they never accounted for.
The second bad source is copying a competitor's price or asking a Facebook group "what does everyone else charge?" This is riskier than it sounds — you have no idea what that competitor's cost structure looks like, how many retainer clients they already have, or whether they're pricing low to survive a slow quarter. Borrowing someone else's number without knowing your own costs isn't pricing. It's guessing.
The Hidden Costs That Have to Live Inside Your Rate
Before running any numbers, you need to know what a freelance rate has to carry that a salaried role never does.
- Unbillable time — finding clients, scoping work, writing quotes, chasing late payments. This routinely eats 20-40% of total working time, and none of it gets paid directly.
- Holidays and sick days that nobody compensates. A day off is a day of zero income.
- Health coverage and social security contributions you now pay in full yourself.
- Equipment, software subscriptions, internet, and workspace costs that need renewing every year.
- Taxes you file yourself — personal income tax, and VAT once revenue crosses the threshold.
- A cash buffer for slow months, since freelance income never lands as evenly as a salary.
Skip these in your rate and you'll discover at year-end that you worked a full year and somehow have nothing left over.
A Step-by-Step Rate Formula
Step 1: Set a target net income for the year
Start with the number you want to actually take home, not the number on your invoices. Say you want 720,000 THB net per year — about 60,000 THB a month.
Step 2: Find your real billable days
A year has 365 days. Subtract weekends, public holidays, time off, and the hours spent on admin — finding clients, bookkeeping, collections. What's left for most solo freelancers is closer to 120-150 billable days a year, not the 250 working days a calendar suggests.
Step 3: Add business overhead and a reserve
Tally software, equipment, insurance, internet, and an emergency buffer. Say that comes to 150,000 THB a year.
Step 4: Calculate your day or hourly rate
Combine the numbers from steps 1 and 3, then divide by your real billable days from step 2.
(720,000 + 150,000) ÷ 130 days ≈ 6,700 THB per day, or roughly 840 THB per hour at 8 hours a day.
That number usually lands higher than freelancers expect. That's the rate that actually keeps a business alive, not just one that keeps you fed.
Step 5: Convert it into a project price
Estimate the real hours a project will take, multiply by your hourly rate, then add a buffer of 15-20% for scope risk — the revisions a client asks for beyond what was agreed. That buffer belongs in every quote you send, not just the ones for messy clients.
Hourly, Fixed-Project, or Value-Based: An Honest Comparison
No single model wins for every job. Each comes with real trade-offs.
Hourly pricing is the most transparent. Clients understand it instantly, and it suits work with a fuzzy or shifting scope. The downside: the faster and better you get, the less you earn, because income is tied to time instead of outcomes.
Fixed-project pricing gives both sides certainty. The client knows the number upfront, and you benefit from your own speed. The risk is that without a tightly defined scope in the contract or quote, the work quietly expands until it eats your margin. The fix is spelling out revision rounds, delivery timelines, and what's explicitly excluded before anyone signs.
Value-based pricing charges for the outcome a project creates for the client's business, not the hours behind it. It has the highest ceiling, but it requires a track record strong enough to have that conversation credibly — better suited to freelancers with proven case studies than to someone just starting out.
Most freelancers in Thailand start with hourly or fixed-project pricing, then move toward value-based pricing once they've built a portfolio and the confidence to back it up.
Don't Forget VAT and Withholding Tax When You Price
Pricing that ignores tax is one of the most common traps. Most corporate clients withhold 3% tax at source from whatever they pay you. That money isn't gone — it becomes a tax credit you claim back at year-end filing — but it does mean the cash that actually lands is always smaller than the number on your invoice. Freelancers who don't plan for this find their cash flow missing target every time a client applies withholding.
The other factor is VAT. Once annual revenue crosses 1.8 million THB, VAT registration becomes mandatory and a 7% VAT charge needs to sit on top of your quotes. Freelancers approaching that threshold should decide in advance whether their pricing is VAT-inclusive or VAT-exclusive, so margin doesn't quietly disappear into a tax nobody budgeted for.
Why Underpricing Damages the Business Long-Term
Pricing too low doesn't just mean lower income — it damages the business in ways that compound. Cheap rates attract the most price-sensitive clients, who also tend to negotiate hardest and pay slowest. Lower hourly income forces freelancers to take on more work to hit the same monthly target, eating into the time that should go toward skill development, better clients, or simply rest. It becomes a cycle where working harder leaves less room to actually grow the business.
Underpricing also leaves nothing to reinvest — in better equipment, in training, or in hiring help to take on more capacity. The freelancer stays stuck at the same income level year after year, even as their skills keep improving.
How to Raise Prices With Existing Clients Without Losing Them
Raising prices is a normal part of a growing business, not something to feel guilty about — but it needs to be handled deliberately.
- Give 1-2 months notice before the next work cycle, so clients have room to adjust budgets.
- Frame it around value delivered, not just rising costs — point to the outcomes from recent work together.
- Offer a choice — the old price with a reduced scope, or the new price with the same scope — and let the client decide what's worth it to them.
- Test new rates on new clients first to gauge market reaction before rolling an increase out to everyone on the books.
Good clients generally accept a well-justified increase. A client who disappears over a modest price bump is usually a sign they weren't worth keeping in the first place.
Turning a Calculated Rate Into Money That Actually Lands
A carefully calculated rate means nothing if everything after it falls apart. That rate needs to become a proper quote with a defined scope, revision terms, and payment schedule, then an invoice sent on time, followed by tracking what's still outstanding and recording the withholding tax deducted for year-end filing.
This is where a system like MANA closes the gap between the price you set and the money that actually reaches your account — turning a calculated rate into a quote, converting that into an invoice automatically, and tracking the withholding tax withheld on each job, so the number you worked out so carefully doesn't get lost in paperwork later.