Your first invoices have been sent, the assignments are going well, and you see your turnover grow. A nice start to your self-employed adventure! But then the reality comes: the tax authorities want to receive a considerable amount from you next year. As a starter you often do not know exactly how much you have to reserve for your income tax and VAT. And before you know it, you have put too little aside. In this article I explain how you prevent this, without an accountant. With a smart approach and the right template you prevent surprises and keep a grip on your money.
Why putting money aside for the tax authorities is crucial
As an employee, your tax is automatically withheld. As a self -employed person you are responsible for that yourself. That means that you have to put money aside every month for income tax and VAT. Many starters are mistaken in the amounts, and therefore get into trouble at the end of the year.
The biggest pitfall? Think that you can simply spend your turnover. But your turnover is not your profit. And your profit is not your net disposable income. Without a good overview you spend money that you should have set aside.
How much do you have to put aside as a self -employed person for the tax?
A Safe rule of thumb is 30% to 40% to put your profit aside. This depends on your deductible items, turnover, and the VAT that you must pay. In practice, this means that with every payment that comes in, you immediately set a percentage separately, for example in a savings account that you do not just empty.
For most starters it is difficult to estimate which percentage fits best with their situation. That is why it is useful to use a calculation tool, such as the template ‘Set aside for your tax’. With that you immediately see how much you have to keep separate, based on your figures.
No bookkeeper needed: control over your tax reservation
You don’t have to be an accountant to keep an overview. With a practical tool you calculate in a few minutes how much load you have to reserve. That gives peace and financial control. The template of The Happy Financial is specially made for starters, and you can easily show what amount you have to keep separately per month or quarterly. You only enter your income and VAT and the rest is calculated automatically.
3 frequently made mistakes of starters (and how you prevent them)
- Keep everything into account: Because of this you spend money that is intended for the tax authorities unnoticed.
- Do not make a reservation for VAT: Starters often forget that they have to pay VAT every quarter, so that the savings are suddenly used up.
- Shock the first attack: The first attack often only comes after a year. If you have not reserved anything, you will get into the pinch.
By avoiding these mistakes, you as a starter immediately set a good basis for your financial administration.
Practical example: How does it work in practice?
Suppose you have € 4,000 this month. After deduction of business costs you will have € 3,000 profit. You know that you have to pay around 35% tax. That means that you set € 1,050 separately. In addition, you have received € 840 in VAT, which you have to pay after deduction of paid VAT. You also reserve that. That way you know for sure that you will soon have enough money to pay your tax.
With the template ‘Set aside for your tax’ You enter your turnover and costs and you will immediately see the amount that you have to set aside for your income tax (and Zvw!). This gives an overview and prevents stress.
Why this template helps starters grow
If you grow as an entrepreneur, your administration will automatically become more complex. By keeping an overview from the start, you prevent you from correcting afterwards. The template is made for growth: you can continue to use it if you earn more, work with multiple sources of income, or want to make a quarterly reservation. This way you not only work safer, but also more professional. And your customers and the tax authorities notice that.
Immediately get started with your own tax buffer
Do you no longer want to stress about your tax and know exactly how much you have to reserve? Then download the template now ‘Set aside for your tax’. With that you ensure that you keep a grip on your finances, without the need for an accountant.
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