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

The single biggest cash-flow mistake freelancers make is spending money that is not really theirs. A chunk of every payment belongs to the tax office — set it aside the moment it lands and you will never be caught short.

A simple rule of thumb

Rates vary by country and status, but a practical starting point for many freelancers is to reserve somewhere between 25% and 35% of each payment for income tax and social contributions. Check your own country's rates and adjust — the exact number matters less than the habit.

The method that never fails

Open a separate savings account. Every time a client pays you, immediately move your set-aside percentage there and forget it exists. When tax is due, the money is already waiting. No stress, no scramble.

Watch your thresholds too

Many countries have revenue thresholds that change your obligations — VAT/sales-tax registration, a switch in tax regime, and so on. Track your cumulative revenue through the year so a threshold never surprises you.

Let a dashboard do the math

Doing this by hand every month is tedious. Our freelance finance tracker (Excel + Google Sheets) does it automatically: you set your rate once, log each payment, and it shows how much to set aside, your net income and your quarter-by-quarter totals. You track, it calculates.

This article is general information, not tax advice — always check the official rates for your country.