How much should you set aside for tax as a freelancer?

As a freelancer you receive the whole amount from your client — including VAT and before tax. It feels like a lot of money, but part of it isn't yours. Set nothing aside and the tax bill is a shock. Set aside smartly and you never have stress.

Here's a simple guide to how much to save.

What do you still have to pay?

Later, three things come off your revenue:

1. VAT (btw) — which you charge clients and pass on to the tax office.
2. Income tax — on your profit.
3. Healthcare contribution (Zvw) — a small contribution for healthcare.

The VAT isn't yours; you are only "passing it on". The tax and Zvw depend on your profit.

Set the VAT aside immediately

The simplest step: don't count the VAT as your money. Receive an invoice of € 1,210 (€ 1,000 + € 210 VAT)? Put that € 210 aside right away. At your return you pay it (minus your input VAT).

A rule of thumb for the tax

For income tax and Zvw together, many freelancers use this rule of thumb:

Set aside 25% to 35% of your profit for tax.

Earn little, and you're at the lower end. Earn more, and you move up, because you enter a higher bracket. It's a safe estimate — better a little too much than too little.

Do it per month or per invoice

Don't wait until year-end. Two easy ways:

• Per invoice: every time you get paid, put a share aside straight away.
• Per month: at month-end you look at your profit and set aside a percentage.

Ideally use a separate savings account. Then you won't spend it by accident.

Know your exact amount

The rule of thumb is a safe estimate. Want more precision? Work out your net income with the free tool below. It shows roughly what you pay in tax on your profit — and so how much to set aside.

Keep the overview in BoekBrug

In BoekBrug your revenue and VAT are added up per quarter automatically. So you see all year how much to set aside, and you're never caught out at your return.

Important

This is a general explanation, not tax advice. Your percentage depends on your situation. For certainty, check belastingdienst.nl or ask your bookkeeper.