---
title: "How much tax should I put aside? | LocoTap"
description: "A share of every payment, the day it comes in. A 1,000 payment, 30% of it costs, 25% tax on the rest: put 175 aside."
url: "https://locotap.com/learn/tax-aside"
---

# How much tax should I put aside?

A share of every payment, the day it comes in.

**For**

Put tax money away as it arrives, so the tax bill is never a shock.

**When**

Every time a customer pays

## Try it

A 1,000 payment, 30% of it costs, 25% tax on the rest: put 175 aside.

Put aside = payment × (1 − share that’s costs) × your tax rate.

Move it the day you’re paid, before you spend it.

## Worked out

| Costs | At 15% | At 25% | At 35% |
| --- | --- | --- | --- |
| 10% | 135 | 225 | 315 |
| 30% | 105 | 175 | 245 |
| 50% | 75 | 125 | 175 |
| 70% | 45 | 75 | 105 |

## Easy to get wrong

- Spending it, then hoping.
- A friend’s rate instead of your own.
- Keeping it where you spend from.
- Forgetting the sales tax you owe too.

## The tool for it

**Tax set-aside** How much to put away for tax [About it](https://locotap.com/tools/tax-set-aside) [Start free](https://locotap.com/sign-in?back=%2Fapp%2Flearn%2Ftax-aside)

## Questions

**What rate do I use?**

Your own, from last year’s bill or an accountant. Type it in.

**Where do I keep it?**

In a separate account you don’t spend from.

**Does sales tax go in the same pot?**

Keep it apart: it was never yours, and it’s often due sooner.

**What if I put too much aside?**

Then the tax bill is easy, and the rest is yours.

**What counts as costs?**

What you spent to do the work: parts, fuel, tools, rent.

**How often is tax paid?**

It depends on the place and your size. Check the rule where you work.

**What if I’m already behind?**

Start today with every payment, and ask about paying the rest over time.

**Should I do this while I’m small?**

Yes: small is the easiest time to start the habit.

Next · Grow: [How much should I raise my prices?](https://locotap.com/learn/price-rise)