How much to charge as a day rate? Becoming self employed

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I used to work full time but left two years ago to look after my SEN child. My work have asked me to go back as a contractor, so I have some flexibility about when & how much I work. I've never been self employed, so I now need to figure out all the logistics. I plan to set up a sole trader and now I need to tell them how much my day rate will be (or rather, my hourly rate as I only plan to work 5-6 hours a day).

From googling I found a calculator which suggested I take my full time salary, add 30%, and divide by 220. This gives me a day rate of £325. Assuming a 7.5 hour day that gives £43 per hour.

I appreciate I'll need to keep back some money to pay for tax, do a self assessment each year, probably set up a separate bank account to track income & expenses and that I won't be getting any benefits like holiday pay, sick pay, pension etc. I don't actually expect to incur any expenses as I'll be working from home, just talking to clients and working on documents (although I know you can claim some electricity, internet etc as expenses when doing taxes).

Are there any other suggestions for how to calculate a day rate? Anything else I haven't thought of in terms of costs or extra considerations I should build in?

Its not as simple as that

This is pretty accurate

Thank you all for the advice, I think the IR35 issue will give me more leverage to ask for a permanent contract, which would be my preference. But if they don't go for that I now have a lot more information to help me work out a day rate and all the other things I need to consider.

I've now asked ChatGPT, and it suggests £400-£450 a day which I think might be reasonable

Why isn’t it

I’m se

Because HMRC self employed in their mind is somebody who works for different people and cannot be PAYE, we had many builders who worked for the same company year round and were self employed, the company was also told to employ these people on PAYE, that way proper tax, pension and NI are paid.

Are you?

Because it IS possible to have just 1 client and be IR35 compliant and its also possible to have more than 1 and not be.
Its not just about how many clients you have, its about equipment, working hours, management responsibility, going to team events, being able to substitute someone else etc.
I do IR35 reviews and I know what boxes we have to tick

Roughly double your employee hourly rate. This actually works out as roughly the same as employee rate when you consider there is no holiday pay, pension, sickness pay, or pay for all the minor admin that adds up to hours of work: answering emails, setting up meetings, rescheduling meetings, sending and chasing invoices.

Also, when you work, you are working 100% of the time. There's no pay while you make coffee and chat about your day or stop to celebrate a colleague's birthday, or travel between meetings. Freelance focus is intense, so charge for it.

Yoyr calculation sounds about right, though with the changes to NI might be selling yourself slightly short. Will you need insurance? If so, add that on.