How Much to Set Aside for Taxes in Your Business

One of the most common questions we hear from business owners is: “How much should I be saving for taxes?” And honestly, it makes sense. Most people were never taught how to plan for taxes throughout the year. So the result? Stress, confusion, and the occasional “surprise” tax bill.

But once we walk clients through a simple system, everything clicks. They feel more prepared, more confident, and way more in control. You can use the same approach in your own business.

Here’s how to plan ahead for taxes in a way that actually works:

1. Set aside a percentage of every payment you receive.

A solid starting point is usually 15–30%, depending on your income and business structure.
For example, if you bring in $8,000 in a month and save 20%, you’d move $1,600 into tax savings right away. No scrambling. No “do I have enough?” panic at year-end.

2. Review your financial reports each month so you know how your income and expenses are trending.

This helps you adjust your tax savings when things shift.
If your revenue typically sits around $5,000 but jumps to $12,000 during a busy month, increasing your tax savings for that month builds a stronger buffer and keeps you prepared.

3. Create a separate bank account specifically for tax savings.

This keeps your tax money out of sight and far away from your operating expenses.
Many clients tell us they thought they were saving for taxes - but without a separate account, the money just kept getting used. Once they created a dedicated tax account, everything became simpler, clearer, and much less stressful.

Setting money aside for taxes isn’t just about compliance. It’s about creating stability, predictability, and peace of mind as you grow your business.

If you want support staying organized, keeping your books accurate, and preparing for tax season with confidence, we’re here to help.

Reach out to us if you’d like us to take the stress of your business finances off your plate.