Tax write-off calculator
A write-off doesn't make something free, but it does make it cheaper than the price tag. This shows the real after-tax cost of a business purchase.
Estimate only. Figures update as you type. Not tax advice — see the note at the bottom of this page.
What a deduction actually does
A deduction reduces the income you're taxed on, not the tax itself. Spend a dollar on a legitimate business expense and you don't pay tax on that dollar. The saving equals the expense multiplied by your tax rate, which is why the same purchase is worth more to a higher earner.
Why freelancers save more than they expect
For self-employed people, a business expense reduces both income tax and self-employment tax. That second effect adds meaningfully to the saving and is the part most people leave out when they estimate mentally. It's also why diligent expense tracking is worth more to a freelancer than to an employee with the same income.
The trap
Nothing here makes a purchase free, and spending money to save tax is only sensible if you needed the thing anyway. Buying a laptop you'll use daily is a good decision made cheaper by the deduction. Buying one you don't need in December to reduce a tax bill leaves you poorer, just slightly less poorer than the sticker price suggests.
What generally qualifies
The common standard is that an expense be ordinary and necessary for your line of work. Software, equipment, professional development, business insurance, subcontractors, and marketing typically qualify. Mixed personal and business use requires splitting the expense to the business portion, which is where careless claims tend to fall apart under scrutiny.
Common questions
Does a write-off mean it's free?
No. It reduces your taxable income, so you save your tax rate on the amount rather than the whole amount. A purchase is still a purchase.
What tax rate should I enter?
Your marginal income tax bracket, meaning the rate applied to your top dollar of income, not your average rate across all income.
Do large equipment purchases work differently?
They can. Some assets are depreciated over several years rather than deducted at once, though provisions exist that allow immediate deduction in many cases. Worth confirming for anything substantial.