Discount
£0.00
Net
£1,000.00
Tax
£200.00
Total
£1,200.00
Rates & sources
UK company rates (Corporation Tax, VAT, payroll NI) as published by HMRC and Companies House.
Source: HMRC — Running a business — figures refreshed at the start of each tax year.
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When to use this calculator
- Before pricing a job, setting margin targets, or reviewing hiring costs.
- When you want to test sensitivity around volume, VAT, markup, or overhead changes.
- When you need a practical estimate before committing to a budget or proposal.
- When you are modelling break-even volume and want to see how it shifts as overheads or prices change.
- When you are preparing a quote and need to verify that the margin holds after materials, labour, and VAT are accounted for.
A realistic UK planning example
Use these sample inputs as a quick scenario test, then change one variable at a time to compare outcomes.
Subtotal (£)
1000
VAT / Sales Tax Rate (%)
5%
Discount (%)
0
After entering these figures, review discount, net and tax together rather than in isolation — each metric tells a different part of the story. Then rerun the tool with one input adjusted to see which variable has the biggest effect on all three outputs before you settle on a plan.
How to read your results
Discount
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Net
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Tax
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Total
This is the headline outcome of the calculation, but it is most useful when read alongside the supporting metrics below it rather than in isolation. Try changing one input at a time and watching how this total moves to understand which driver has the biggest impact.
Method & assumptionsAuthoritative sources
This calculator computes invoice totals by applying your chosen VAT rate to the net subtotal, then adding any additional line items or deducting discounts. The standard UK VAT rate is 20%, with a reduced rate of 5% applying to certain domestic and energy-related supplies. Enter your net (VAT-exclusive) amount and the applicable rate; the tool outputs the VAT amount and gross total separately.
Discounts are applied to the net figure before VAT is calculated, in line with HMRC rules for prompt payment discounts. The calculator does not store or transmit any data and is intended for quick estimation. For formal invoicing, always use compliant accounting software that produces records meeting Making Tax Digital requirements. Consult HMRC guidance or an accountant if you are unsure which VAT rate applies to your supply.
Common mistakes
- !Using optimistic assumptions without testing a more cautious scenario as well.
- !Comparing outputs from different tools without checking that the inputs match.
- !Treating the result as a final quote instead of a planning estimate.
- !Forgetting to include employer National Insurance contributions when modelling the true cost of a new hire.
- !Using revenue figures in place of gross profit when calculating margin percentage, which produces a misleadingly high result.
What to do next
- Try at least one more scenario with a lower price or higher cost so you can see the margin floor.
- Use the related calculators below to cross-check VAT, payroll, or break-even figures from another angle.
- Open one of the linked guides if you need more context before you finalise a quote or budget.
- If the margin is tighter than expected, identify which single input has the biggest impact and focus any negotiation there first.
- Keep a record of the assumptions behind this estimate so you can revisit and update it when costs or volumes change.
Frequently asked
Use arrow keys to navigate items, Enter or Space to expand/collapse.
End-of-article next steps
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