How much should I set aside for tax as a tradie?

Many tradies park around 25-30% of income for income tax and GST combined, but the right figure depends on your profit, deductions, rate and structure. Treat it as a starting discipline and confirm the percentage with your accountant.

How do I calculate the GST to set aside?

If you are registered for GST, one-eleventh of each GST-inclusive payment you receive is GST. So on a $1,100 invoice, $100 is GST to remit. Moving that out as you are paid means it is there at BAS time.

Do I have to register for GST?

You must register once your turnover reaches the ATO registration threshold, and you can choose to earlier. Once registered you charge GST, claim GST credits, and lodge a BAS. Check the current threshold with the ATO or your accountant.

How much should I put aside for tax and GST?

Set aside GST (one-eleventh of GST-inclusive takings) plus a tax buffer in a separate account. Many tradies park 25-30% combined. How to get the figure right.

Quick answer

As a working habit, set aside GST as you collect it (GST is 10% of the sale, i.e. one-eleventh of a GST-inclusive total) plus a portion of profit for income tax. Many tradies park 25-30% of income for tax and GST combined in a separate account, but the right figure depends on your rate, deductions and structure. Confirm your percentage with your accountant and adjust as you go.

Skill level: All levels
Time: 4 min read
Trade: Bookkeeping & Cashflow
Updated: 14 November 2026

The short answer

The money you collect for the ATO is not yours -- but it sits in your account looking like cash until the BAS or tax bill lands. The fix is a habit: move a set percentage out of reach every time you get paid.

GST is the easy part to calculate: if you are registered, one-eleventh of every GST-inclusive payment you receive is GST you will remit. Income tax is trickier because it depends on your profit, deductions, and rate -- which is why a combined "safe" percentage plus a separate account works well as a discipline.

What it depends on

Whether you are registered for GST -- you must register once turnover reaches the ATO threshold; below that GST may not apply.

Your profit and tax rate -- income tax is on profit, not turnover, so deductions change what you owe.

Your structure -- sole trader marginal rates differ from a company rate.

How lumpy your income is -- bigger buffers help if your work is seasonal.

Your next step

Open a separate account, move GST (one-eleventh of GST-inclusive takings) plus a tax buffer across every time you are paid, and reconcile at BAS time. A bookkeeper or accountant can set the right percentage for your numbers so you are neither short nor starving cashflow. See money and business, or ask a specialist.

Frequently asked questions

How much should I set aside for tax as a tradie?: Many tradies park around 25-30% of income for income tax and GST combined, but the right figure depends on your profit, deductions, rate and structure. Treat it as a starting discipline and confirm the percentage with your accountant.
How do I calculate the GST to set aside?: If you are registered for GST, one-eleventh of each GST-inclusive payment you receive is GST. So on a $1,100 invoice, $100 is GST to remit. Moving that out as you are paid means it is there at BAS time.
Do I have to register for GST?: You must register once your turnover reaches the ATO registration threshold, and you can choose to earlier. Once registered you charge GST, claim GST credits, and lodge a BAS. Check the current threshold with the ATO or your accountant.

Written by Tally, the Bookkeeping & Cashflow specialist at QLD.Tools.