How much should you set aside for tax?
A practical rule of thumb for how much to reserve from every invoice for BTW, income tax, and the Zvw contribution — with worked examples.
Every euro your clients pay you is not wholly yours. A chunk — sometimes a substantial one — is earmarked for the Belastingdienst. If you spend it all and don't set aside a reserve, you'll face a nasty surprise when the bills come due. This guide shows you how much to reserve, how to structure your savings, and how to avoid the cash-flow crunch that sinks many new freelancers.
The three taxes you must pay
As a Dutch freelancer, you owe three layers of tax:
1. BTW (VAT) — charged quarterly. You collect it from customers and pass it to the Belastingdienst. The amount depends on your turnover and what you sell.
2. Income tax (inkomstenbelasting) — due once a year on your profit. Rates vary by income level; roughly 36–37% on lower bands and up to 49.5% on income over roughly €76k–€78k (these brackets change yearly; check belastingdienst.nl for current rates). You also get deductions like the zelfstandigenaftrek and entrepreneur relief (MKB-winstvrijstelling) that reduce your taxable base.
3. Zvw contribution — a small health-insurance-linked contribution on your profit, roughly around 5% (hedge this — rates change). Added to your monthly zorgverzekering premium.
None of these come out of your invoiced amount automatically. You have to calculate them, set them aside, and pay them on time.
The simple rule of thumb
As a rule of thumb, set aside 25–30% of every invoice for taxes. Here's why:
- BTW: 21% on most goods/services. You pay this to the Belastingdienst quarterly, but you also reclaim input VAT on your business purchases, so your net BTW is usually much less. Call it 3–8% of turnover depending on your cost base.
- Income tax: On a profit margin of 40% (a common figure for freelancers), you might pay €0.36–€0.49 per euro of profit after deductions. If your margin is 50%, call it roughly €0.37–€0.49 per euro in income tax. This is highly variable.
- Zvw: Around 5% on profit.
Combined, a conservative estimate is 25–30% of gross invoiced revenue. If your business costs are very high (say 70% of revenue), you may get away with 20%. If your costs are low (say 20% of revenue), reserve 30% or slightly more.
Reserve rule of thumb
A worked example
You're a freelance copywriter. Your monthly invoicing is €4,000.
Gross revenue: €4,000
Business costs (software, contractor fees, equipment): €800
Estimated profit: €3,200
BTW due (quarterly): Assume 21% on €4,000 = €840. But you reclaim input VAT on your €800 costs, roughly €168. Net BTW ≈ €672 per quarter, or €224 per month on average.
Income tax (annual): On €3,200 monthly profit, that's €38,400/year. Less zelfstandigenaftrek (€2,470 in 2025), you have €35,930 taxable. Roughly 37% average tax rate (varies by exact brackets), that's about €13,294/year, or €1,108/month.
Zvw (roughly 5% on profit): €3,200 × 5% = €160/month.
Total per month: €224 + €1,108 + €160 = €1,492 out of €4,000 = about 37%.
So in this case, you'd reserve 37% of your €4,000 monthly invoicing, or €1,480.
Use the forecast tool
This varies wildly by your sector, costs, and income. Use ZZP Belasting to forecast your exact tax bill based on your actual profit. Don't guess — calculate it.
How to structure your reserves
A single bank account is chaos. Create a simple system:
1. Separate savings account for taxes. Open a separate savings account (at the same bank or a different one) labeled "Tax reserve" or similar. Every month, transfer your reserve amount there. Don't touch it except to pay taxes.
2. Monthly transfers. On the day you invoice or get paid, calculate 25–30% and move it to the tax pot. Make it automatic (standing order) if your bank allows.
3. Track it in a spreadsheet or tool. Note each month:
- Gross invoiced
- Amount reserved
- Running total in the tax pot
- Expected quarterly BTW payment
- Expected annual income-tax bill
This visibility prevents panic. You'll always know whether you have enough set aside.
4. Plan for lumpy payments. BTW is due quarterly (30 April, 31 July, 31 October, 31 January). The income-tax bill hits in late May or early June once you file. The Zvw comes monthly with your insurance premium. Sequence these in your forecast so you're never caught short.
Let ZZP Belasting do the maths
Automatic BTW returns, income-tax forecasts and depreciation — from the invoices you already have.
Try it freeWhat if you set aside too much (or too little)?
Too much: If you overpay tax, the Belastingdienst will refund you after you file your return. You'll see the refund credited to your account weeks or months later. That's fine — it's an interest-free loan to the government. Better safe than sorry.
Too little: If you underpay, the tax office assesses you with interest (rente) on the unpaid amount, plus sometimes a penalty. You're also at risk of cash flow crisis if you've already spent the money. Always err on the side of setting aside too much, not too little.
When you pay via voorlopige aanslag (instalments)
If you're on a voorlopige aanslag (estimated-tax instalments), your income tax is split into monthly payments throughout the year, not a lump sum in May. The same principle applies: set aside your monthly instalment from your invoicing. The advantage is that the hit is smaller each month and you're less likely to run short.
See the voorlopige aanslag explained for how this works.
Frequently asked questions
Can I claim the reserve as a business cost?
What if my profit is negative one year?
Is it better to use a high-interest savings account for the tax pot?
Should I account for the MKB-winstvrijstelling when calculating my reserve?
The freelancers who sleep best are the ones who know they have tax money set aside. You're not guessing, not panicking, and not caught short when the bill arrives. Start with the 25–30% rule, refine it based on your actual costs and profit, and move that amount every month without fail. One year later, you'll have zero stress about tax season.