I currently work full time as an employee at DQ, but have recently taken on a side job as a subcontracted wedding planner where I will need to keep track of my payable taxes.
I'm trying to calculate how much tax I should set be setting aside for my second job, however the TurboTax calculator is spitting out a really high number, and it's a little concerning!
I currently make about $30,000/year at DQ, and will be making an additional $4,000/year with my side job. Before my side job, it says I'll owe about $3,500 in taxes, and after my side job I'll be owing an additional $1,200 in taxes. This means that I'll be needing to save 30% of every cheque from my side job for taxes? I'll only be making $34,000/year, so this number should be landing somewhere around 15-20%! (I live in BC).
Am I missing something? Please tell me the calculator is wrong, haha.
Any insight would be much appreciated.
Thank you!
The TurboTax Calculator is correct. When you are self employed you are also required to pay into CPP based on your net self employment earnings. Not only are you required to pay the employee portion, you are also required to pay the employer portion. This results in an additional 9.9% added to your tax liability. So 30% is accurate.
The TurboTax Calculator is correct. When you are self employed you are also required to pay into CPP based on your net self employment earnings. Not only are you required to pay the employee portion, you are also required to pay the employer portion. This results in an additional 9.9% added to your tax liability. So 30% is accurate.