How to prove Income as a freelancer? See the main ways to do it!

Have you ever wondered how much easier it would be to rent a house or get a mortgage if it were simpler to prove your income as a freelancer? For many independent workers, this task can seem daunting, since, unlike those with formal employment, there's no fixed paycheck to show. Situations like trying to rent a property, opening a bank account, or even filing your income tax return can become more complicated without proper guidance.

In this article, you'll discover practical and efficient ways to prove your income as a freelancer, whether for rental purposes, credit, or other financial needs. We'll explore the best strategies so you have all the necessary documentation on hand and can handle these situations with confidence.

See this text:

• What is proof of income?
• How do I prove my income as a self-employed person? What are the methods?
• How to prepare your own income tax return?
• Is proving income when self-employed really important?

What is proof of income?

A proof of income is a document that demonstrates the origin and amount of a person's income, used to validate their financial capacity in various situations.

What is it for?

Proof of income is essential in several situations, such as:

• Rent a property
• Request credit or financing
• Declare income tax

For workers with formal employment contracts, this process is simple, as they have access to automated documents, such as pay stubs and paychecks, that facilitate proof of their income. These documents are widely accepted and provide standardized information about monthly income.

For self-employed workers, the situation is different. There's no company that automatically provides these receipts. Instead, income verification can be done through various documents, such as:

• Bank statements: Show the inflow and outflow of money.
• Payment receipts: They prove the services provided and the amounts received.
• Income Tax Declaration: Official document that shows the self-employed person’s annual income.
• Service provision contracts: They serve as proof of commercial agreements and agreed values.

Although the process is different and requires more organization, proof of income for self-employed individuals is perfectly feasible with the appropriate documents.

How do I prove my income as a self-employed person? What are the methods?

Proving your income as a freelancer may seem complicated, but there are several documents you can use for this purpose. Each of these documents serves to demonstrate the regularity of your income, depending on your situation. Here are the main ones:

• Bank statements: These show your account's cash flow, highlighting the amounts received over time. They're useful for demonstrating the regularity of your income.
• Payment receipts for services rendered: Each job performed can be recorded through receipts, which serve as proof that the service was provided and payment was received.
• Income Tax Declaration (IRPF): The annual tax return is an official document that summarizes your earnings throughout the year. Besides being accepted in many situations, it provides credibility to your income statement, as it is a tax document.
• Declaration of Income Receipt (DECORE): Issued by accountants, this statement validates the origin and value of a self-employed person's income, offering more formal proof.
• Service provision contracts: If you have contracts with clients, they can be used to show the agreements and amounts paid for services.
• Invoices: If you issue an invoice as an MEI or in the name of your company, this document serves as a solid form of proof of income.

Each of these documents can be used individually or together, depending on the requirements of the location where proof of income will be requested.

How to prepare your own income tax return?

One of the most efficient ways to prove your income as a freelancer is by creating a own income statementThis document can be prepared independently and is accepted in many situations, as long as it is well-structured and includes credible information. Here's a step-by-step guide to preparing your tax return:

1. Header
   Start with a formal heading, which might include:
   • Your full name
   • CPF or CNPJ (if MEI)
   • Address and contacts (phone and email)
   • Date of issuance of the declaration
2. Income Statement
   Next, write a brief statement explaining that you're proving your income as a self-employed worker. Something like: “I, [your full name], self-employed in the area of [your field of activity], declare for all due purposes that the amounts below reflect the income obtained for services rendered in the period of [month/year or specific time interval].”
3. Earnings Breakdown
   The next step is to clearly and organizedly list your earnings. Include the following information for each client or service:
   • Customer name (individual or legal entity)
   • Service provided
   • Date of service (or time interval)
   • Amount received for each service

   Example:

   • Client: XYZ Company
   • Service: Marketing Consulting
   • Date: June 2024
   • Value: R$ 3,500.00
4. Final summary of values
   At the end of the statement, include a total summary of values received during the period. This helps anyone reviewing the document quickly understand how much you earned during the period mentioned.
5. Signature and authentication
   Finish the document with your signature. To add credibility, you can notarize your signature or have an accountant evaluate and issue a supplementary document, such as a Declaration of Income Receipt (DECORE).

Is proving income when self-employed really important?

Proving your income as a freelancer is essential to guarantee access to various opportunities that depend on validating your financial capacity. Whether renting a property, securing a loan, or even opening a bank account, the lack of a pay stub or pay stub shouldn't be an obstacle. Proving adequate income allows you to demonstrate to banks, landlords, and tax authorities that your earnings are regular and sufficient to cover your financial obligations.

Furthermore, keeping your documentation organized and up-to-date prevents future problems, especially when it comes to complying with tax obligations, such as filing your income tax return. This way, you not only meet market demands but also strengthen your professional image. In short, having a good income verification strategy is essential for financial stability and success as a freelancer.