Freelancer money setup checklist

1. Separate business and personal money

• Open a separate account for business income and expensesSome banks do not allow business use of personal accounts; check the terms.
• Pay yourself a regular amount from the business accountA fixed transfer makes personal budgeting easier.
• Use one card for business spending only
• Compare account fees for your actual usageMonthly fee, transfers, cash deposits, foreign currency.

2. Build a tax buffer

• Estimate your tax rate on profitUse last year’s return or your tax office’s calculator.
• Move that share of every payment you receive into a separate savings account
• Note your advance or estimated tax payment dates in your calendar
• Check whether you must register for VAT, GST or sales taxThresholds and rules differ by country.

3. Invoice properly

• Use sequential invoice numbers
• Include the details your country requiresFor example names, addresses, tax IDs, dates, amounts and tax.
• State payment terms and how to pay
• Track unpaid invoices weekly and follow up

4. Keep records lenders ask for

If you later apply for a loan, card or lease, lenders usually want proof of stable income. Keeping these ready saves time.

• Tax returns or annual accounts for the last one to two years
• Business bank statements for the last 3 to 12 months
• A list of open invoices and regular clients
• Business registration and ID documents
• Contracts for ongoing work
• Know your country’s record retention periodIt is often several years and can be up to a decade.

5. Plan for quiet months

• Write down your fixed monthly costs, business and personal
• Choose a target buffer in months of fixed costsUse the savings goal calculator to plan the monthly amount.

Regional notes

• US: Self-employed people generally pay estimated tax quarterly (IRS Form 1040-ES).
• UK: Self Assessment can require payments on account on 31 January and 31 July.
• Germany: The tax office can set quarterly advance income-tax payments (Vorauszahlungen).
• EU: Cross-border B2B services often use the VAT reverse charge; check the invoice wording required.
• Elsewhere: Ask your tax authority about advance payments, registration thresholds and invoice rules.