> ## Documentation Index
> Fetch the complete documentation index at: https://docs.timetracker.in/llms.txt
> Use this file to discover all available pages before exploring further.

# Cost rates

> A cost rate is what one hour of a person's time costs your business. Learn how TimeTracker uses it for margin, who may see it, and the Pro plan requirement.

A **cost rate** is what one hour of a person's time costs your business.

## A simple example

Sarah Lin's cost rate is **\$45 per hour**.

She tracks **3 hours** on "Homepage wireframes".

`3 × $45 = $135`

Those 3 hours cost Northwind Studio **\$135**.

Her billable rate is $100/hour, so the same 3 hours are worth $300 to the client. The **margin** is `$300 − $135 = $165`.

## A business example

The same week on Bluebird Coffee – Website Redesign:

| Person        | Hours  | Billable rate | Revenue     | Cost rate | Cost        | Margin      |
| ------------- | ------ | ------------- | ----------- | --------- | ----------- | ----------- |
| Sarah Lin     | 12     | \$100         | \$1,200     | \$45      | \$540       | \$660       |
| Jonas Bergman | 8      | \$120         | \$960       | \$60      | \$480       | \$480       |
| **Total**     | **20** |               | **\$2,160** |           | **\$1,020** | **\$1,140** |

Margin percentage: `$1,140 ÷ $2,160 = 52.8%`.

That single number is the reason cost rates exist. Priya can see the project is still healthy before the budget runs out, not after the invoice is sent.

## What it is

A cost rate is a price per hour, attached to a **person**, with three parts:

| Part           | Meaning                                         |
| -------------- | ----------------------------------------------- |
| Amount         | A non-negative decimal, such as `45` or `62.75` |
| Currency       | A three-letter code, such as `USD`              |
| Effective from | The date the rate starts applying               |

## Why it exists

Revenue on its own tells you nothing about whether a project is worth doing. A retainer that bills \$10,000 a month is a good deal or a bad one depending entirely on what the hours cost you. The cost rate is the input that turns revenue into margin.

## What to put in a cost rate

Cost is your figure to define. Common approaches:

| Approach       | What you use                                               |
| -------------- | ---------------------------------------------------------- |
| Salary only    | Annual salary ÷ working hours per year                     |
| Fully loaded   | Salary plus employer taxes, benefits, software, desk space |
| Contractor pay | What you actually pay the contractor per hour              |

Northwind Studio uses fully loaded costs for employees and pay-through for contractors – which is why Ana Ferreira's cost rate ($55) sits so close to her billable rate ($80).

## Cost lives on the person only

There is no project cost override and no client cost override. Someone costs you the same whoever they are working for.

| Level   | Billable rate | Cost rate |
| ------- | ------------- | --------- |
| Task    | Yes           | No        |
| Project | Yes           | No        |
| Person  | Yes           | **Yes**   |
| Client  | Yes           | No        |

On a project's **Team** table the **Cost** column is read-only for exactly this reason. To change what someone costs, change their person rate at **Settings** → **Rates**.

## How to set a cost rate

<Steps>
  <Step title="Open Settings → Rates">
    Go to **Settings**, then **Rates** under **Billing & rates**.
  </Step>

  <Step title="Open the person">
    Use the action at the end of their row and choose **Manage**.
  </Step>

  <Step title="Switch to the Cost tab">
    The tab is labelled **Cost (internal)**. If you do not see it, you do not hold `rate.viewCost`.
  </Step>

  <Step title="Enter the rate">
    Fill in **Rate / hour**, **Currency** and **Effective from**.
  </Step>

  <Step title="Click Add rate">
    You see **"Cost rate saved."**
  </Step>
</Steps>

## Permissions – cost is a firewall

Cost visibility is deliberately narrower than billing visibility.

| Capability         | What it allows       | Default roles                 |
| ------------------ | -------------------- | ----------------------------- |
| `rate.manage`      | Set and remove rates | Owner, Admin, Project Manager |
| `rate.viewBilling` | See billable rates   | Owner, Admin, Project Manager |
| `rate.viewCost`    | See cost rates       | **Owner, Admin only**         |

A Project Manager can manage rates and see every billable rate, but never a cost figure. When Priya opens the Rates page:

* The **Cost rate** column is not rendered.
* The **Cost (internal)** tab is not rendered.
* The cost rows are not in her rate history.

This is not a hidden column that could leak. The cost figures are removed before the page is built, so there is nothing to inspect.

<Tabs>
  <Tab title="Owner / Admin">
    Sees both columns, both tabs, and the full history. Can set and remove cost rates.
  </Tab>

  <Tab title="Project Manager">
    Sees billing only. Can set and remove billing rates. Cost is absent everywhere.
  </Tab>

  <Tab title="Finance">
    Holds no rate capability at all. Cannot open the Rates page. Can still invoice already-priced time.
  </Tab>

  <Tab title="Member / Contractor">
    No access to rates. Cannot see their own rate on this page.
  </Tab>
</Tabs>

See [/rates/rate-permissions](/rates/rate-permissions) and [/concepts/roles-and-capabilities](/concepts/roles-and-capabilities).

## Plans – cost rates need Pro

Setting a cost rate requires the **`profitability`** feature, which is on the Pro plan. This is the one rate write that is plan-gated.

| Action                                         | Free | Pro |
| ---------------------------------------------- | ---- | --- |
| Set a billable rate                            | Yes  | Yes |
| Set a cost rate                                | No   | Yes |
| Read cost, revenue and margin already recorded | Yes  | Yes |

<Note>
  Dropping to Free never deletes cost data. Cost, revenue and margin already recorded stay readable – you cannot record a **new** cost rate until you are back on Pro. See [/concepts/plans-and-features](/concepts/plans-and-features).
</Note>

Who may **see** a cost number is always a capability question (`rate.viewCost`, `time.viewCost`), never a plan question.

## Edge cases

<AccordionGroup>
  <Accordion title="No cost rate is set">
    Entries record billable value but no cost. Margin cannot be calculated, so profitability figures for that person are missing rather than wrong.
  </Accordion>

  <Accordion title="A cost rate higher than the billable rate">
    Allowed, and worth knowing about. It means you are losing money on every hour. Nothing blocks it – TimeTracker reports the negative margin rather than refusing the number.
  </Accordion>

  <Accordion title="A contractor whose pay changes per project">
    Cost is per person, so pick the figure you want to plan against and set a project **billable** override for the price difference. Cost cannot vary per project.
  </Accordion>

  <Accordion title="I raised someone's salary. Do old projects get more expensive?">
    No. Entries snapshot the cost rate they were recorded at. Add a new dated cost rate and work from that date forward uses it. See [/rates/rate-snapshots](/rates/rate-snapshots).
  </Accordion>

  <Accordion title="Can I hide cost from my Project Managers?">
    It is already hidden. `rate.viewCost` is Owner and Admin only by default.
  </Accordion>

  <Accordion title="Cost rate in a different currency">
    Allowed. Each rate carries its own currency. Keep it consistent with your workspace base currency unless you have a reason not to. See [/rates/currencies-and-exchange-rates](/rates/currencies-and-exchange-rates).
  </Accordion>
</AccordionGroup>

## Options and settings

| Field              | Rules                                                                             |
| ------------------ | --------------------------------------------------------------------------------- |
| **Rate / hour**    | Required. A non-negative decimal.                                                 |
| **Currency**       | Required. A supported three-letter code. Defaults to the workspace base currency. |
| **Effective from** | Required. Defaults to today. Handled as a whole day.                              |

## What happens next

1. New time entries for that person record a cost alongside the billable value.
2. Project profitability and margin become available – see [/budgets/profitability-and-margin](/budgets/profitability-and-margin).
3. Cost-bearing reports can be run by people who hold the cost capability.

## Troubleshooting

| Message or symptom                                                               | Meaning                                | Fix                                                |
| -------------------------------------------------------------------------------- | -------------------------------------- | -------------------------------------------------- |
| The **Cost (internal)** tab is missing                                           | You lack `rate.viewCost`               | Ask an Owner or Admin                              |
| A Pro upgrade prompt appears on save                                             | Your plan lacks `profitability`        | Upgrade, or set the billable rate only             |
| "That rate won't work. Enter an amount that isn't negative, like 120 or 120.50." | The amount is negative or not a number | Enter a plain decimal                              |
| Margin is blank on a project                                                     | Some people have no cost rate          | Set a cost rate for each person who tracked time   |
| Cost did not change on old entries                                               | Expected                               | See [/rates/rate-snapshots](/rates/rate-snapshots) |

## Related guides

<CardGroup cols={2}>
  <Card title="Billable rates" icon="dollar-sign" href="/rates/billable-rates">
    The other half of the margin.
  </Card>

  <Card title="Profitability and margin" icon="chart-line" href="/budgets/profitability-and-margin">
    Where cost is actually used.
  </Card>

  <Card title="Rate permissions" icon="lock" href="/rates/rate-permissions">
    The cost firewall in full.
  </Card>

  <Card title="Set a person rate" icon="user-pen" href="/rates/set-a-person-rate">
    Step by step.
  </Card>

  <Card title="Rate snapshots" icon="camera" href="/rates/rate-snapshots">
    Why raising a salary is safe.
  </Card>

  <Card title="Plans and features" icon="badge-check" href="/concepts/plans-and-features">
    What Pro adds.
  </Card>
</CardGroup>