How much does a side-business entrepreneur earn?

Rule of thumb: 50% goes to the government

Are you about to start a side business and wondering what to expect financially? As a rule of thumb, you can assume that around 50% of the difference between your income and expenses as a side entrepreneur goes to the government.

The exact calculation is complex and depends on your personal situation, your main income, your family situation, and your deductible expenses. But in general, about half of your profit goes to VAT, social contributions, and taxes.

1. VAT

As a side entrepreneur, you’ll deal with VAT regularly—but there’s good news: VAT does not come out of your own pocket.

You act as an intermediary. Your customers pay VAT to you, and you pass it on to the government. The VAT you pay on business expenses can be deducted from the VAT you owe.

That’s also why accounting figures are shown excluding VAT—it gives a more accurate picture of your financial situation.

2. Social contributions

As a side entrepreneur, you pay social contributions on your net taxable income. These are not technically taxes, but they are payments to the government that fund social security (pension, healthcare, child benefits, etc.).

How much do you pay?

Rates for 2025:

• Income up to €1,881.76: exempt

• Income between €1,881.76 and €17,008.88: 20.5% on the amount above €1,881.76

• Income above €17,008.88: same rates as a main activity

Minimum contribution: €99.38 per quarter

Good to know: as a side entrepreneur, you already build social rights through your main job. The contributions you pay do not usually provide additional benefits. However, there is also no high minimum contribution—if your income drops, your contributions decrease as well.

3. Personal income tax

If you don’t operate through a company, your business income is considered personal income. It is added to your other income (such as your salary) and taxed through personal income tax.

Belgium uses a progressive system. For income year 2025 (assessment year 2026):

• €0 – €16,320: 25%

• €16,320 – €28,800: 40%

• €28,800 – €49,840: 45%

• Above €49,840: 50%

Example:
If you earn €40,000 as an employee, your side income will fall directly into the higher tax brackets (45% or even 50%). This means that nearly half of every extra euro may go to taxes.

4. Local taxes

In addition to federal taxes, local taxes also apply.

Provincial tax
Once a year, you receive a declaration form. This tax is usually based on your business space. If you work from home or use a small space, you typically pay the minimum amount.

Municipal tax
Your municipality charges an additional tax on personal income tax, usually between 5% and 9%. This is paid together with your annual tax return.

PIA Go! Always know what you really keep

Do you sometimes lose track of your income as a side entrepreneur? PIA Go! helps you understand not just your revenue, but your real net income.

With clear dashboards, you instantly see your income, expenses, and final result. Our accountants provide insights and help you optimize your taxes.

Want to keep more?

Here are three smart finance tips:

• optimize your deductible expenses
  Make sure you claim all professional costs: equipment, travel, part of your internet, and even part of your home if you work from there

• rethink your pricing
  Ensure your prices cover all costs, taxes, and still leave you with a satisfying income

• consider setting up a company
  If your profit exceeds €20,000, a company structure may be more tax-efficient, allowing you to retain part of your profit at a lower tax rate

Curious whether a company structure makes sense for your situation?
Get in touch with the experts at PIA Group.