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Setting aside for tax from each payment
The simplest way to avoid a hard tax bill is to treat part of every payment as never yours to spend.
Check the rules first
Side income is usually taxable, even in small amounts. Some countries have thresholds or simplified regimes. Your tax authority's website explains what applies to you. In Brazil, the Receita Federal publishes guidance on self-employed income and the MEI regime.
Set aside on arrival
When a payment arrives, move a fixed share into a separate account straight away. An accountant can help you choose a sensible share for your situation.
Keep a plain record
- Date and source of each payment
- Amount after fees
- Fees and costs, with receipts
- Amount set aside
Review every quarter
Every three months, compare what you've set aside with what you're likely to owe. Adjust the share if needed, well before the deadline.
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