Everhour Reporting turns logged time into billability views, while the calculation shows where revenue is gained or lost.
Track billable vs. non-billable time and see your real utilization rate and revenue potential in seconds.
Working hours in the period
Admin, meetings, internal work
Industry average is 75–80%
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Maximizing billable hours means finding approved client work that can be invoiced under the engagement, contract, or project policy. The calculation answers three practical questions: how many hours are billable, what those hours are worth at the correct rate, and where revenue disappears through non-billable work, write-downs, discounts, or uncollected invoices.
The useful output is not just a dollar total. You need billable hours, billed amount, utilization, realization, collection, and effective billing rate. Utilization compares billable time with total worked time. Realization compares billed value with billable value before write-downs. Collection compares paid invoices with billed invoices. Effective billing rate divides collected or billed revenue by total worked hours.
The basic formula is billable hours times the applicable hourly rate, after rounding to the billing increment required by your contract or policy. If different people, tasks, or phases use different rates, calculate each line separately and then add the line totals. Taxes, discounts, expenses, and late-payment interest are separate invoice items, not part of the raw billable-hours subtotal.
For example, a client redesign project includes 28 approved strategy hours at $155 per hour and 19 approved production hours at $125 per hour. The strategy line equals $4,340. The production line equals $2,375. The billable-hours subtotal is $6,715 before write-downs, taxes, discounts, expenses, or collections.
The fastest way to increase billable hours is to recover work that already qualifies as billable but was missed, misclassified, or written down without review. Common leaks include client calls logged as internal meetings, project management time left unassigned, small follow-up tasks never entered, and approved work left in a draft timesheet after the invoice closes.
Separate legitimate recovery from overbilling. A one-hour internal staffing discussion stays non-billable unless the client agreement says otherwise. A 20-minute client status call belongs in the billable total when the engagement allows client communication time. For U.S. lawyers, ABA Model Rule 1.5 requires the scope of representation and the basis or rate of fees and expenses to be communicated in writing for new client-lawyer relationships, subject to the rule's limited low-cost exception.
A one-off calculation is enough when you are checking a single invoice, estimating revenue from a small project, or comparing two pricing scenarios. Put approved billable hours, non-billable hours, rates, write-downs, taxes, and collected payments into the same view so the result shows both invoice value and lost value.
A managed workflow is necessary when several people log time, rates vary by project or member, entries need approval, or invoice status must be reported later. Everhour Reporting can group time by project, member, task, client, billable status, cost, invoice status, and other columns, so managers can review where billable value is created before invoices are finalized.
This content is for general information only, may not be fully up to date, and is provided without any warranty or liability.
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Multiply approved billable hours by the correct hourly rate, then add each rated line together. If the project uses multiple rates, calculate each rate group separately. Apply write-downs, discounts, taxes, reimbursable expenses, and payments after the billable-hours subtotal so the invoice value and the working-time value stay clear.
Recover eligible work that was missed or misclassified, enforce timely time entry, review draft entries before invoicing, and keep non-billable categories narrow and consistent. Do not move internal, administrative, or excluded work into billable totals unless the client agreement, engagement terms, or project policy allows it.
Realization shows whether billable value becomes billed value after write-downs or discounts. Collection shows whether billed value becomes paid revenue. A team can have strong billable hours and weak cash results if large write-downs or unpaid invoices reduce the final collected amount.
No. Billable hours and hourly rates create the service subtotal. In the United States, there is no federal VAT/GST or national sales-tax rate for billed professional time. Tax treatment is state and local, so use a jurisdiction-specific tax input only when the service is taxable.
The common mistake is optimizing only the number of billable hours while ignoring realization and collection. Ten extra billable hours add no revenue if they are written down before invoicing or remain unpaid. Track billable hours, billed amount, and paid amount as separate checkpoints.
Everhour Reporting provides customizable reports with 45+ columns, filters, grouping, exports, and scheduled email delivery. A manager can group logged time by project, member, task, billable status, billable amount, cost, and invoice status to see where billable value increases or leaks.
Everhour Billing & Invoicing turns tracked billable time and expenses into invoices, calculates amounts from rates and time, excludes non-billable work, and marks invoiced time so the same entries do not appear again in later invoices.
Track approved hours, billable status, rates, and invoice status in Everhour Reporting so billable-hour improvements turn into clearer revenue, utilization, and profitability decisions.
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