I Bill 40,000 Euros a Year as a Freelancer: This Is What I Actually Keep

When someone asks how much you earn as an autónomo (a self-employed worker / freelancer) and you say “I bill forty thousand a year”, the next question should be: “yeah, but how much do you actually keep”. Because between billing forty thousand and having forty thousand in your pocket there’s a chasm that only those who live it understand.

This article is the complete, real breakdown of a freelancer who bills 40,000 gross euros a year. No tricks, no optimism, nothing hidden. The whole calculation, from the first euro that comes in to the last one left available to live on.

The profile

So the numbers have context, we’ll use a specific profile:

• Freelance web designer, registered for three years (no flat-rate discount).
• Bills Spanish clients with IVA (value-added tax) at 21%.
• Works from home (no rented office or coworking space).
• Estimación directa simplificada (the simplified direct-assessment tax method).
• No employees.
• Single, no children (for the income tax return).

This profile is one of the most common among freelancers in the services sector. If your situation is different (IVA-exempt activity, the módulos flat-rate regime, premises expenses), the numbers change, but the structure of the reasoning is the same.

Gross billing: 40,000 euros

This is what appears on the invoices issued during the year as the total taxable base. It’s not what they collect (that includes the IVA they later hand back), nor what they keep (that’s the end of this article).

Billing isn’t regular. One month more comes in, another less. But on average it’s about 3,333 euros of taxable base per month.

Deductible expenses: 8,200 euros

A services freelancer who works from home has relatively modest professional expenses compared with a shop or an industrial business. But added up they come to a respectable figure.

We round to 8,200 euros a year of deductible expenses. If you want to dig into what you can and can’t deduct, we have a complete guide to deductible expenses.

Important note: these expenses carry their own input IVA, which is deducted on the modelo 303 (the quarterly IVA return). We’ll cover that in the IVA section.

The freelancer fee (cuota de autónomos): 5,124 euros

With a net income of about 2,465 euros a month (we’ll calculate it shortly), the contribution bracket (2,330-2,760 euros) corresponds to a fee of 427 euros a month in 2026.

The freelancer fee is deductible as an expense on the income tax return (it reduces the IRPF base), but it isn’t deductible for IVA (it carries no IVA). It’s a mixed expense: it reduces your taxable profit but not your quarterly IVA.

Net income: 26,676 euros

Now we can calculate net income, which is the figure that really matters for working out taxes:

This is the net income that goes on the income tax return. And it’s on this number (approximately) that the IRPF (personal income tax) is calculated.

Quarterly IVA: 0 euros net (but you need cash flow)

IVA is a neutral tax for the freelancer: you charge it to your clients and hand it back to the Spanish Tax Agency (Agencia Tributaria), keeping only the IVA you yourself paid your suppliers. In theory it costs you nothing. In practice, you need cash flow to manage it.

You pay those 6,678 euros in four quarterly instalments of roughly 1,670 euros each (you can estimate your own amount with the quarterly IVA calculator). It’s not your money (you collected it from your clients), but it sits in your account until you pay it. And if you don’t set it aside, when 20 April, July, October or January comes around, you’re short.

To really understand the quarterly IVA mechanism: how to calculate quarterly IVA without a gestoría.

Net result of IVA for your pocket: zero. But you need to manage a flow of 8,400 euros coming in and 6,678 going out over the year.

IRPF: quarterly payments + income tax return

Quarterly modelo 130

In direct assessment, each quarter you pay 20% of the accumulated profit for the year (minus what you’ve already paid in previous quarters). The simplified calculation:

Total IRPF paid on account during the year: 5,335 euros.

(The accumulated profit here is income minus deductible expenses, including the freelancer fee, which is also deductible. The numbers are approximate for an even distribution.)

Income tax return

In the annual return, the real IRPF is calculated on the reduced net income (25,342 euros). Applying the state and regional brackets (they vary by region), the approximate total IRPF for a single person with no children with this income is about 4,700 euros (you can work out yours with our IRPF simulator).

Since you’ve already paid about 5,335 euros on account with the modelo 130 returns, the tax return comes out with a refund of about 635 euros. This varies a lot depending on personal deductions, your autonomous community and other income.

Real IRPF cost for the year: about 4,700 euros.

The final tally: what you actually keep

Now we add it all up:

For every 100 euros you bill, you keep about 55 in your pocket.

Another way to see it: per month, out of the 3,333 euros of average billing, you keep about 1,831 euros to live on. The rest goes on professional expenses (683 euros), the fee (427 euros) and a reserve for IRPF (392 euros).

The monthly breakdown in practice

This is what a typical month looks like in the bank account:

Wait. Earlier we said 1,831 euros a month and now it comes to 945. The difference is that here we’re setting aside the tax reserves within the same month. The money reserved for IVA comes back in the form of quarterly payments you’ve already got covered. It’s not your expense, but it’s not available either until you pay the quarter.

If you don’t set aside those reserves and live on the 4,033 euros that come in, when the quarter arrives you’re short 5,000+ euros all at once. This is rookie freelancers’ number-one mistake: spending the IVA.

Comparison with an employee

An employee earning 40,000 gross euros a year has a net of approximately 30,800 euros (depending on region and personal situation). That’s about 2,200 euros net a month across 14 pay periods.

A freelancer who bills 40,000 euros keeps 21,976 euros net. That’s 1,831 euros a month.

The difference: the employee earns 40% more net with the same “gross”. But be careful with this comparison:

• The freelancer deducts expenses (the employee doesn’t, apart from union dues and little else).
• The freelancer can bill more if they work more or raise their rates.
• The employee has paid holidays, paid sick leave, unemployment benefit. The freelancer doesn’t.
• The freelancer pays less into Social Security, which means lower benefits.

The fair comparison isn’t 40,000 vs 40,000, but what quality of life each model gives you with that figure.

How to improve the percentage you keep

Increase legitimate deductible expenses. If you can justify a coworking space, a professional vehicle, more training or better tools, every euro of deductible expense reduces your IRPF.

Raise your rates. If you bill more without your fixed expenses rising proportionally, the percentage you keep improves. At 50,000 in billing with the same 8,200 in expenses, you keep 57% clean.

Plan depreciation. Big purchases (computer equipment, vehicle) are depreciated over several years. Timing your purchases to maximise the tax deduction can save you several hundred euros a year.

Don’t forget any expense. Many freelancers lose between 500 and 1,500 euros a year in deductible expenses they don’t record because they seem “trivial” or they don’t keep the receipt. Every professional taxi receipt, every technical book, every software licence adds up.

How does Cuéntamo help with this?

Working out “what you actually keep” has a lot of moving parts: the VAT you collect that isn’t yours, the freelancer fee, the IRPF payments on account and the deductible expenses that lower your base. Doing it by hand every quarter is exactly the tiring bit. Cuéntamo’s self-employed module handles it for you.

As you record your income and expenses, Cuéntamo calculates the quarterly IVA and IRPF settlements from your real transactions, broken down by VAT rate. You mark an expense as deductible and it goes into the calculation; the VAT you’ve paid is offset against the VAT you’ve collected, and your net income builds up quarter by quarter instead of landing on you all at once in May.

And because you have the cash-flow forecast in front of you, the money you collect as VAT that isn’t yours stops getting mixed up with your profit: you see how much you’ll owe each quarter before the date arrives, and you avoid the classic scare of spending a VAT amount that was due to be paid.

If you just want a quick estimate with your own figures, there’s the free quarterly VAT calculator and the IRPF simulator, no sign-up required. And to keep the full picture, the self-employed module lives inside Cuéntamo.

Frequently asked questions

How much do you actually keep billing 40,000 euros a year as a freelancer?

In the profile we analyse (freelance web designer, no flat rate, in simplified direct assessment) about 21,976 euros a year are left clean, around 55% of what’s billed. Your figure will vary depending on your deductible expenses, your autonomous community and your personal situation.

Why isn’t billing the same as earning?

Because from what you bill you have to subtract professional expenses, the freelancer fee and IRPF, as well as managing the IVA you charge and then hand over. Between billing a figure and having it in your pocket there’s a chasm.

Is IVA an expense for the freelancer?

In net terms, no: you charge it to your clients and hand it over to the Agencia Tributaria, deducting the IVA you paid your suppliers. But you do need cash flow to manage it, because the money sits in your account until you pay the quarter.

Why do I have to set aside money for taxes every month?

Because if you live on everything that comes into the account, when the quarter arrives you’re short several thousand euros all at once. Setting aside the IVA and IRPF reserve every month is what avoids rookie freelancers’ number-one mistake: spending the IVA.

Does an employee earn more than a freelancer with the same gross?

With the same gross figure, the employee keeps a higher net, but the comparison isn’t direct: the freelancer deducts expenses and can raise rates, while the employee has paid holidays, sick leave and unemployment benefit. The fair comparison is what quality of life each model gives you.

Figures for 2026. The self-employed fees and the IRPF brackets are updated each tax year; the general IVA rate in the breakdown (21%) has been in force since 2012 (RDL 20/2012).

This article is checked against official sources and reviewed periodically. If you spot anything out of date, email us at [email protected].