Planning parental leave when you're self-employed?
Taking time off when you own a business can take a little more planning. Even if you’re stepping away from work for a few months, your business expenses don’t necessarily stop with you.
This calculator is designed to help you work out how much cash you may want to have sitting in your business before you take parental leave, so you can enjoy that time without worrying about whether the next business bill is covered.
Add in how long you’re planning to take off, the business expenses that will continue while you’re away, any income you expect the business to keep earning, and how much you’d like to draw personally during that time.
We’ll give you an estimated target cash buffer and, if you’ve already started saving, how much you still have left to put aside.
A couple of things to keep in mind
This is a planning tool rather than personalised financial or tax advice. Your actual cash requirements will depend on your business and circumstances.
The calculator also doesn’t include tax payments. Before you head off on leave, make sure you’ve separately allowed for any GST, provisional tax, terminal tax, PAYE or other tax payments that will fall due while you’re away.
And remember: the goal isn’t necessarily to stop working with a huge pile of cash in the bank. It’s to understand what your business needs, make a plan early and give yourself one less thing to think about when baby arrives.
1. How long are you planning to take off?
You can use half months too — for example, 4.5 months.
2. What business costs will keep going?
Enter the average amount you expect to pay each month while you're off.
3. Will money still come into the business?
Think recurring income, staff-generated revenue, retainers or other income that will continue while you're not working.
4. Are there any one-off business costs?
Add any known non-monthly bills or costs you expect to pay while you're off.
5. Would you like to keep paying yourself?
Optional — enter the total amount you'd like available to draw from the business during your time off.
6. How much cash have you already set aside?
Enter the amount currently available for your parental leave plan. Don't include money you've already earmarked for tax or other commitments.
We have a blog post sharing all you need to know regarding keeping your business going and paid parental leave for the self employed too! Read it here.
Disclaimer: This calculator is a general planning tool designed to help you think about your potential cash needs while taking parental leave. Results are estimates only and are based entirely on the information you enter. They don’t take into account your individual circumstances and aren’t financial, accounting or tax advice. Prosper Business accepts no responsibility for decisions made or losses incurred based on the results of this calculator. We recommend getting personalised advice before making financial or business decisions.