Tax Set-Aside Calculator

This tax set-aside calculator shows how much of a month's freelance income to move into a tax reserve at the percentage you choose, and how much is left. Enter gross monthly income and a percentage to compare two amounts: money reserved and money remaining. It performs that split; it does not work out your tax liability, so the section on choosing a percentage below shows how to pick a number from your own records.

How the calculator works

Gross monthly income is the amount you expect to receive before subtracting expenses or taxes. A contracted amount and cleared cash can differ, so label your estimate in your notes. The percentage is an input you choose; the tool does not infer it from income or location.

Set aside = income × percentage ÷ 100. Remaining = income − set aside.

Illustrative example: entering $8,000 and 25% gives a $2,000 reserve and $6,000 remaining. At 30%, the reserve becomes $2,400 and the remainder $5,600. That $400 difference shows the cashflow tradeoff; it does not tell you which percentage matches your actual obligations.

Remaining money must still cover expenses, owner pay, and other commitments. It is not automatically disposable income. Results use USD formatting and round to whole dollars; the calculator does not convert currencies.

Compare percentages without treating them as advice

The 20%, 25%, 30%, and 35% buttons let you compare scenarios quickly. You can enter your own percentage between 0 and 100. A larger reserve leaves less money in the remaining bucket; it does not establish that the reserve is sufficient.

Keep the basis of your chosen percentage beside your calculation: the income period, whether you used receipts or an estimate, and when you will review it. If the percentage is still unknown, use the results as scenarios while you establish an appropriate plan.

Choose a percentage from your records

The most reliable starting percentage is your own. Take your last filed return, add up every tax it shows on your self-employment income (income tax and any self-employment, National Insurance, or pension contributions), and divide by that year's net profit. That is your effective rate on profit.

The calculator works on gross income, so convert the rate if your expenses are significant. Multiply the rate on profit by the share of income left after expenses. Illustrative example: an effective rate of 24% on profit, with expenses taking 15% of income, becomes 24% × 0.85 = 20.4% of gross income. Round up rather than down; a little extra reserve is easier to deal with than a shortfall.

If you have no filed return yet, two worked examples show why the number is often higher than people expect. Both are simplified and ignore other income, credits, and regional differences.

• United States, $60,000 net profit: self-employment tax alone is $60,000 × 92.35% × 15.3% = about $8,478, or roughly 14.1% of profit, before any federal or state income tax.
• England, £40,000 profit in 2026 to 2027: after the £12,570 Personal Allowance, £27,430 is taxed at the 20% basic rate (£5,486), and Class 4 National Insurance at 6% on the same band adds £1,645.80. The total is £7,131.80, about 17.8% of profit. Rates are on GOV.UK income tax rates and allowances.

Once you have a percentage, enter it above and check that the remaining amount still covers your expenses and pay. If it does not, that is a pricing signal, not a reason to lower the reserve; the freelance rate calculator shows what you would need to charge.

What a reserve may need to cover

A self-employed tax bill often includes more than income tax. The items below are a checklist for choosing your percentage, not a formula; deductions, allowances, and other income change the result.

• United States: federal and state income tax plus self-employment tax. Self-employment tax is 15.3% of 92.35% of net self-employment earnings; for 2026 the 12.4% Social Security part stops at $184,500 of combined wages and net earnings ($192,300 for 2027), while the 2.9% Medicare part has no cap. An extra 0.9% Medicare tax applies above $200,000 (single) or $250,000 (married filing jointly). See the IRS self-employment tax page, or get the exact figure with the self-employment tax calculator. The freelance tax deductions guide covers what lowers the profit figure first.
• United Kingdom: income tax plus Class 4 National Insurance, which for 2026 to 2027 is 6% on profits between £12,570 and £50,270 and 2% above that. See self-employed National Insurance rates.
• Canada: federal and provincial income tax plus both the employee and employer shares of CPP contributions (QPP in Quebec). For 2026, CPP applies to earnings between the $3,500 basic exemption and $74,600, with an additional second tier above that. See CPP rates and maximums.
• Australia: income tax and the Medicare levy, usually paid through PAYG instalments once the ATO enters you into them.

If you charge sales tax, VAT, GST, or HST, that money belongs to the tax authority. Keep it out of the income you enter here and reserve it separately.

Set aside per payment or per month

For a monthly plan, enter the month's estimated receipts and compare one planned transfer. For irregular payments, the same formula can be applied to each payment when it clears. Use one approach consistently and reconcile the total so you do not reserve the same receipt twice.

Line the reserve up with your payment dates. In the U.S., the last 2026 federal estimated tax payment is due January 15, 2027; the Q4 2026 estimated tax checkpoint covers it. The freelance tax calendar for November 2026 to April 2027 lists the national dates in the U.S., UK, Canada, and Australia in one place, and the country notes in what to track weekly for taxes explain each system. UK sole traders already sending quarterly updates can check the Making Tax Digital 2026 to 2027 checkpoint.

Keep a weekly record

1. Record payments that cleared and match them to invoices.
2. Record the percentage used, reserve calculated, and transfer made.
3. Save expenses and receipts alongside the income records.
4. Compare remaining cash with near-term commitments and flag any shortfall.
5. Review overdue invoices and schedule the next follow-up.

For the broader recordkeeping routine, use what to track weekly for taxes. For overdue receivables, use the invoice and late-payment templates. In the U.S., your records are also what you reconcile against the 1099-NEC and 1099-K forms for 2026 that clients and payment platforms send early next year, and the U.S. federal tax return guide for freelancers shows where the reserve ends up on your return.

Keep the reserve visible

Track reserved money separately from ordinary spending, using an account, sub-account, or clear bookkeeping record. If you use reserved funds, record that change so your notes show what is actually available. The calculator does not monitor balances or move money. For the rest of the money side of freelancing, from invoicing to records and returns, start at the money and tax guides.

Does this tool save my numbers?

The calculator keeps inputs in page memory and does not save them when you reload. Its tool-interaction event identifies the calculator without including the income or percentage entered. For site-wide analytics and data handling, read the Privacy policy.