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I have been a freelancer for 24 years, and had this problem. Here's how I solved it. I incorporated my business, and I am an employee. My corporation pays me a
by momirlan 8y ago
I have been a freelancer for 24 years, and had this problem. Here's how I solved it. I incorporated my business, and I am an employee. My corporation pays me a stable amount, so I'm not worried. When I put the business hat on, I make sure I project the yearly income and have a generous salary fund ( 6 months). No worries anymore, the most I have been without work has been 3months. If at the of the year I haven't spent my salary fund, i have extra money.
Another truth one must acknowledge is that its not about how much you make , its how much you spend. When you have financial discipline the mind is free.
- sovietmudkipz 8y agoThat sounds interesting. What are the tax implications of such a setup?
- momirlan 8y agoIt's a common setup in Canada. I paid corporation tax once for money left over in the company account, but that is just cost of doing business for me. Once I have the 6 months of salaries, I just roll it over year over year with no more tax to pay. Salary is taxed as regular income.