Calculator
Contractor vs Employee Calculator Australia
Work out the contractor rate you need to genuinely match an employee package - super, leave, insurance and unbilled days included.
Short answer
To match an employee salary as a contractor you must self-fund what the employer covered: 12% super, annual and personal leave, public holidays, insurance and downtime, while billing only the days you work. A $110,000 salary therefore needs a rate well above the $423 a day that dividing by 260 suggests.
Required day rate
$666.88
To match the employee package
Required hourly rate
$87.75
At 7.6h/day
True employee value
$146,046
Salary + super + leave + costs
Billable days / year
219
After leave & holidays
A lower contractor rate that "looks higher" than a salary can leave you worse off once you fund your own super, leave, sick days, insurance and downtime. Calling a worker a contractor to avoid entitlements may be unlawful sham contracting - check Fair Work and the ATO.
Why a higher rate can still be worse
A day rate that looks higher than a salary can leave you behind once you self-fund super, take unpaid leave, carry insurance and absorb downtime between contracts. This tool adds those back so you compare like with like.
Sham contracting warning
Calling a worker a contractor to avoid employee entitlements can be unlawful sham contracting. Whether someone is genuinely a contractor depends on the working relationship, not just an ABN. See contractor vs employee in Australia and check Fair Work and the ATO.
Frequently asked questions
Do contractors pay their own super?+
Often yes, though in some cases a business must pay super for a contractor who is mostly paid for their labour. Check the ATO's super for contractors guidance.
What about GST?+
Contractors earning over the GST threshold generally must register for and charge GST. This calculator focuses on the rate needed to match a salary, before GST.
Is an ABN enough to be a contractor?+
No. Having an ABN does not make you a contractor for legal purposes - the nature of the work relationship decides it.
Sources & methodology
- ATO - Personal income tax: new tax cuts (15% rate from 1 July 2026)
- Income Tax Rates Act 1986 (legislation.gov.au)
- ATO - Study and training loan repayment thresholds and rates
- ATO - Super guarantee
- ATO - Contribution caps
- ATO - Payday Super and the annual maximum contribution base
- ATO - Medicare levy
- ATO - Medicare levy surcharge income thresholds and rates
- Fair Work Ombudsman - Pay slips
- How we calculate these estimates
Last updated 13 August 2026. Figures use the 2026-27 financial year.
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