What Percentage of your Income Do You End Up Paying Out in Taxes?

The title pretty much sums up the post.

 

I am taxed at about 14%.

 

In the UK it can end up being as much as 60%. I'm not in that bracket but trying to be

 

THis last year I paid out 20%

 

If you are a real business and file a schedule C you will pay 10% Federal tax as soon as you hit $8,900 in profit which is essentially minimum wage. You will also be required to pay 15.3% in Social Security as there is no employer match.

So out of the gate if you are a REAL BUSINESS earning any kind of income that you would call "full time" you'll start out paying 25%. This does not include other business taxes from local or state municipalities.

If you are not a real business and you do not file a schedule C you will pay whatever rate you are paying for the bracket you are currently in.

 

the right question is : what is your taxable income ?

if you are a business you can end up paying zero taxes. get incorporated.

if you are an employee then you are screwed.

 

thanks to the country i live in and some creative accounting i pay 0% tax

but that is the very small risk i take

 

This is far from true...there is no such thing as paying zero taxes.

 

a business pays taxes after making its expenses. near zero taxes are possible if you can get a really creative accountant.

 

I am paying 20% and soon my income will increase and then I need to pay 30%..

 

Around 20-25%.

Gotta love Canadian taxes

 

Granted, but it's not quite a good practice for the long run. You can't get a loan, for example.