Quote:
Originally Posted by cedricstudio
The reason freelancers can charge more is because they have a lot of expenses that would normally be paid by your boss. Advertising, computer equipment, software, art supplies, website fees, professional memberships, travel to conferences, etc.
And of course the big one--taxes. Self-employed people are charged a special tax called the Self-Employment tax (or SE Tax), which effectively doubles the amount of taxes a normal employee would pay per year.
I've been freelancing for ten years and I only get to keep about 50-60% of what I make per hour. It's still not a bad living. I just don't want anyone to get the impression that freelancing is a way to get rich quick.
|
This is dependant completely on where in the world you live though, but ti would be interesing to hear about these things for different countries as well.
I know that in Sweden, where I currently reside, the boss would pay the equivalent of 100% your salary in a special "pot" that is turned into insurances, pensions, vacationmoney and similar.
This mean that when you hire anyone at a set salary of (lets just fake it and say) 10 euros anhour, the boss actually puts out 20 euros an hour.
If you are selfemplyed, you get to decide these things yourself, which means that you can take out your full salary minus the taxes (same as when working for your boss) but then decide yourself wether you should put away money for, for instance, vacation and pension.
Essentially, if you decide to work without any form of vacaion for five years, you can get some serious spending cash for things you want to put into your company.
This is the financial part of it all, and on a general "own business" level, but this topic is about freelance salaries..being a freelancer is techically having a business of your own so...