1. Make a new layer and hide the other layers.
2. Design the tattoo on this layer using full opacity black. Make sure it's not too detailed, because the small details won't be apparent in-game (unless it's on the portrait).
3. Unhide the other layers and change the blending mode of the tattoo layer to Overlay.
4. Move the tattoo around a bit to get a nice position. Consider how it will mirror if it's on a part of the skin that is mirrored (back and front of arm/both arms back and front/ only front/etc).
5. Reduce opacity of the tattoo layer if there are parts that appear pitch black.
6. If the tattoo becomes very saturated (for example, on a brown surface, the tattoo tend to look dark red), duplicate the tattoo layer and set blending mode to Color. Reduce opacity until you have a subtle, realistic colour.
7. Touch the tattoo up, in a new layer, with freehand. Add some soft, thin highlights around it to enhance the contrast between the tattoo and the skin.