Calculate your take-home pay as a self-employed individual

Learn how to calculate your take-home pay or net profit as a self-employed individual.

Your take-home pay or net profit is the money that remains after subtracting all your expenses, benefits, and taxes. Use the following formula to calculate how much you’ve earned so you can make better business decisions using that info.

Take-home pay formula

Take-home pay = Total self-employment revenue - Cost of Goods Sold - Expenses - Interests - Taxes

Use this example as a guide for calculating your net income

• Total self-employment revenue: $100,000
• Cost of Goods Sold:                   -$40,000
• Operating expenses
  • Rent:                              -$10,000
  • Utilities:                            -$2,500
• Interest expense:                         -$1,500
• Taxes:                                          -$1,000
• Net profit:                                  =$45,000

Use the Accounting Glossary to search for terms you’re not familiar with or find related articles and resources.