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To survive, you need to ensure that the profits from your business allow you to pay your private expenses.

A private budget must show how much money you need to pay your personal outgoings.

Your profit is your salary

If you have a budget account with your bank, take that as your starting point. The statement shows how much you spend on rent/mortgage, food, paying off the loan for your car and holiday home, or what you pay for sending your child to kindergarten.

When starting your own business, the money you need for private consumption should come out of the profit generated by your business. The business's profit is your "salary".

In other words: Your income = the business' profit.

Facts

Calculate your "salary" by seeing how big a profit is shown in your operating budget.

Be realistic

There are big differences in how much money an entrepreneur needs to survive. If you are starting a business just after you have completed your studies and you don't yet have regular outgoings for a house and car, your living expenses are relatively modest. On the other hand, you may need to earn more money if you have a lot of fixed outgoings.

Tax on profit

The profit your business generates is, for tax purposes, regarded as the salary you would receive as an employee.

However, if you have a limited company (ApS or A/S), you will be paid by your company, and the company will have a profit, which is taxable.

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