Guide
Set up a separate account for tax money
Ring-fence what you owe the taxman so it's never sitting in your spending balance by mistake.
Open a second, separate account
A basic savings account at the same bank works fine. The only requirement is that it's separate from your main spending account and mildly annoying to move money out of.
Pick a percentage, not a guess
Ask your accountant or use your last tax bill to estimate a rough percentage of income to set aside. Round up, not down, it's much easier to get money back than to find it unexpectedly.
Move money the moment you get paid
Transfer your set-aside percentage as soon as an invoice is paid, not at the end of the month. If it waits, it gets spent.
Never touch it for anything else
Treat this account as if it isn't yours. Even a 'quick borrow' during a slow month has a habit of not getting paid back before the bill is due.
Review the percentage every year
Your tax rate, income level, and obligations can change. Revisit the percentage with your accountant annually rather than assuming last year's number still holds.
That’s the whole thing.
Keep going
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- 02
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Get a business debit or credit card
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Read your bank statement like a founder
Spend fifteen minutes a month actually understanding where your money went, and where it's going.