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How to Use This Self-Employment Tax Calculator
This calculator estimates your total self-employment tax obligation — combining self-employment or CPP-equivalent tax with federal and state or provincial income tax — and breaks it into quarterly estimated payments.
How It’s Calculated
In the US, it applies 15.3% SE tax (Social Security plus Medicare) on 92.35% of net earnings, plus ordinary income tax on the net profit minus half the SE-tax deduction. In Canada, it applies CPP contributions (both the employer and employee portions) plus federal and provincial income tax on net business income.
Example
$80,000 in net self-employment income in the US generates roughly $11,300 in SE tax alone, before federal or state income tax is applied — which is why quarterly estimated payments matter.
Frequently Asked Questions
Why do self-employed people pay more payroll tax than employees?
Employees split Social Security and Medicare (or CPP) with their employer. Self-employed workers pay both halves themselves, since there’s no employer to cover the other side.
How often do I need to pay estimated taxes?
In the US, quarterly (April, June, September, and January). In Canada, quarterly instalments are required once net tax owing exceeds a CRA threshold in the current and one of the prior two years.
Can I deduct half of my self-employment tax?
Yes — in the US, half of the SE tax is deductible against income tax, which softens the total burden somewhat.