Updated for 2025 • SelfEmployedDocs

Self-Employed Gross vs Net Income Explained (Fast Guide)

If you’re self-employed, people constantly ask for your “income.” The problem is, nobody ever explains what they actually mean.

Do they want gross income? Do they want net income? Or just whatever number makes their form happy?

This guide breaks it down in plain English so you know exactly what to use on applications, forms, and proof-of-income documents.

What is gross income if you’re self-employed?

Gross income is the total amount of money you bring in from your work before subtracting any expenses.

For example:

• You make $6,000 in one month from clients or customers.
• You spent $1,500 on supplies, gas, advertising, etc.

Your self-employed gross income = $6,000.

That’s the “big number” — all the money that hits your business before anything comes out.

What is net income if you’re self-employed?

Net income is what’s left over after expenses.

Using the same example:

• Gross income: $6,000
• Business expenses: $1,500

Your self-employed net income = $6,000 – $1,500 = $4,500.

This is closer to what you actually “take home,” even if it’s not the exact number after taxes.

Which number do landlords and lenders want to see?

Most of the time, they’re interested in your net income, because that shows what you realistically have available to pay rent, loans, or bills.

But here’s the twist:

• Some forms simply say “monthly income” and don’t clarify.
• Some agents don’t even understand the difference.

So what do you do?

Best approach:

• Know both numbers (gross and net).
• If the form doesn’t specify, use the net income you can genuinely afford things with.
• If they ask later, you can explain exactly how you calculated it.

How to calculate your gross and net income quickly

Step 1: Add up your income

Look at your last 1–3 months of:

• bank deposits
• Cash App / Venmo / Zelle payments
• gig app payouts
• client invoices

Total that up — that’s your gross income for the month(s).

Step 2: Subtract business expenses

Include things like:

• gas and mileage (for work)
• tools and supplies
• software or apps you pay for
• equipment
• ads or marketing

Gross income – expenses = net income.

Step 3: Find your average

If your income changes month to month, take an average of the last 3–6 months.

That’s usually what landlords, lenders, and agencies want to see anyway.

Gross vs net income on a pay stub

If you use a pay stub to prove income, both numbers usually show up:

• Gross pay – total for that pay period
• Net pay – the amount “take home” after deductions

Even if you’re self-employed, you can still create a professional pay stub based on your real numbers.

Which income should you use for proof of income?

In most cases, use net income, because that’s closer to what you really have available to spend.

But the best option is to combine:

• a clear pay stub showing gross and net, and
• your bank statements showing deposits

That way you don’t have to argue about the numbers — everything is right there.

How pay stubs help you avoid confusion

Instead of explaining your business, your expenses, and your fluctuating income 20 different ways, a pay stub:

• summarizes your income in a format people recognize
• shows gross and net in one place
• reduces questions, back-and-forth emails, and delays

FAQ: Self-Employed Gross vs Net Income

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