Sole trader OT (NDIS) - putting aside 35% for tax. What should I actually be doing with it?

Hi all,

I’m a newly established sole trader Occupational Therapist in Australia working in the NDIS space, and I’m hoping to sanity-check my approach to tax.

Context:

I’m a sole trader (not a company or trust)

Currently not registered for GST (turnover below $75k)

I bill at the NDIS rate of $193.99/hr

Income is variable (mix of face-to-face, telehealth, report writing)

I invoice plan managers and self-managed participants

I have no tax withheld at source

To stay on top of things, I’m putting aside 35% of every invoice paid into a separate savings account labelled “Tax - do not touch”.

My understanding is that this 35% buffer is meant to cover:

Income tax

Medicare levy (2%)

HELP/HECS repayments (I do have a HELP debt)

Any future PAYG instalments if they’re applied

My questions:

Is 35% a sensible amount to be setting aside at this stage, or is it excessive / insufficient?

Should this money just sit in a savings account until tax time, or should I be making voluntary payments to the ATO during the year?

At what point do PAYG instalments usually kick in for sole traders, and is it better to opt into them early or wait?

Are there any common mistakes sole traders in health/NDIS make with tax that I should be aware of early?

Any insight would be appreciated.

I’m planning to engage an accountant, but I’d really value some lived experience from people who’ve been through something similar.

Thanks in advance. I’m trying to set this up properly from the start and avoid any nasty surprises later.

Cheers!