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Comment by sillysaurusx | Hacker News Reader

Any tax tips? That's an interesting observation.

(Thank you!)

Not the OP, but the best 'tax tips' come from a tax professional in your region.

I'm in the US, and use a payroll service to pay myself a regular salary. The payroll service deducts and pays appropriate taxes and paperwork. I then also make estimated quarterly tax payments as well, to deal with any estimated overage I may earn/owe. I then pay a tax professional to reconcile everything at the start of the tax season.

Meet with a tax professional. Meet with 2 or 3. Find someone you're comfortable with who has clients like you. Or... find people like you and get referrals as to who they use.

Personally I have an offset account against my mortgage and stockpile funds there. Then live well within my means so I can handle tax when it arrives. Someone who doesn't naturally live within their means could estimate in advance and push money to a separate account to isolate it.

Don't you have to pay estimated taxes anyways? Or do you just mean within the quarter between estimated tax payments? (I am salaried and already just budget by quarter for everything)

Where I live, a salaried person will have tax automatically withheld and paid to authorities by their employer each week/fortnight. Someone self-employed usually has an estimate they pay quarterly or monthly, and then adjustments at the end of the financial year if the situation has varied from the estimate. I'm just saying I stockpile between tax bills (holding the cash against my mortgage to minimise interest) and my general style of living/spending means I can just redraw from the mortgage to make tax payments.

You don’t _have_ to pay estimated taxes. If you choose not to you just pay a penalty at tax time (essentially interest on what you didn’t pay throughout the year). It’s up to you to decide if it’s worth it. I freelanced for a few years and just paid the penalty because I didn’t want to spend time thinking about taxes more than once a year. For how much I was making at the time I was fine with this trade off.

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