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Locum Rate Calculator & Tax Guide

Calculate your real hourly rate after pension, tax, indemnity, and downtime—UK, US (1099), Canada, and Australia-ready.

Review date
Jan 2026
Author
Dr Kola Tytler MBBS CertHE MBA MSt MRCGP
On this page
Career toolkitPractical prompts and templates for applications, portfolios and professional development. Check local employer and regulator requirements before use.
Locum work is only lucrative when you treat it like a micro-business: revenue is easy to see, costs are usually hidden. This calculator converts a headline rate into an evidence-based ‘effective rate’ that accounts for pension, indemnity, insurance, CPD, unpaid admin, and gaps between bookings.
1

Step 1 — Start with your headline rate

Enter: hourly/day rate, expected weekly hours, and realistic booked weeks/year (not 52). Most locums overestimate utilisation—use a conservative baseline first, then optimise upward.
2

Step 2 — Subtract true costs (not just tax)

Include: indemnity/malpractice, GMC/AHPRA/provincial fees, accounting/bookkeeping, subscriptions, equipment, travel, and CPD. Add a line item for ‘admin time’ (e.g., 30–90 minutes/day) as an opportunity cost.
3

Step 3 — Pension & benefits adjustment (region-specific)

UK: model NHS Pension contributions and the difference between pensioned vs non-pensioned income. US (1099): include self-employment tax, malpractice, and retirement contributions (solo 401(k)/SEP). Canada: consider incorporation feasibility and overhead. Australia: include superannuation expectations depending on contract structure.
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Step 4 — Convert to Effective Hourly Rate (EHR)

EHR = (Annual gross – annual costs – annual tax estimate) / (clinical hours + admin hours). This is the number you should negotiate from—everything else is marketing.

UK Locum Reality Check

UK engagement structure matters. Sole trader vs limited company can change tax outcomes, but IR35/employment status can collapse the advantage if the engagement resembles employment. Optimise legally, but model conservatively in the calculator first.

Negotiation Lever

If a payer won’t move the rate, negotiate what affects your EHR: paid admin time, guaranteed minimum sessions, cancellation protection, paid travel, and faster invoicing terms.
SourceDownload Locum Rate Calculator (Spreadsheet + Examples)
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  • Enter: hourly/day rate, expected weekly hours, and realistic booked weeks/year (not 52). Most locums overestimate utilisation—use a conservative baseline first, then optimise upward.

    Return to this section

  • Include: indemnity/malpractice, GMC/AHPRA/provincial fees, accounting/bookkeeping, subscriptions, equipment, travel, and CPD. Add a line item for ‘admin time’ (e.g., 30–90 minutes/day) as an opportunity cost.

    Return to this section

  • UK: model NHS Pension contributions and the difference between pensioned vs non-pensioned income. US (1099): include self-employment tax, malpractice, and retirement contributions (solo 401(k)/SEP). Canada: consider incorporation feasibility and overhead. Australia: include superannuation expectations depending on contract structure.

    Return to this section

  • EHR = (Annual gross – annual costs – annual tax estimate) / (clinical hours + admin hours). This is the number you should negotiate from—everything else is marketing.

    Return to this section

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