Here's what I did (at least before the local airport made it legally impossible to be an independent CFI):
Flat rate for CFI.....................................................20/hr
2/ hr more for each 100 hrs of dual given.............80/hr
Specialized experience (airline pilot, additional instructor ratings, etc at 2/ hr for each................................................8/hr
As you can see, it becomes too much per the formula after a while, so you have to be reasonable...I stopped at 45/ hr.
What is important is that the student realize that your time is valuable. I billed from show time to when we parted, except for lunch if we had it. Why? Because:
1. Forces stdt to be on time for lesson.
2. Stdts will spend 45 minutes of YOUR time making small talk. You are unavailable to anyone else during this booking, and the stdt wants you for free by samll talking with a question peppered in here and there? No way Jose.
3. You position yourself as a professional.
4. The student will expect (and deserves) professional instruction.
Good luck.