Profit margin calculator
See what is left after your business expenses, and what share of your revenue that represents. Use income and expenses from the same period.
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How to calculate profit margin
Recorded pre-tax profit = revenue − total expenses. Margin = profit ÷ revenue × 100. Include your operating expenses as well as direct costs to estimate an overall margin; using direct costs alone gives a gross margin.
Use the same period, currency and VAT basis for both figures. This calculation does not apply tax adjustments or check whether your records are complete.
Worked example
With £10,000 revenue and £6,500 expenses, recorded pre-tax profit is £3,500 and the margin is 35%. If expenses rise to £11,000, the result becomes a £1,000 loss and a −10% margin.
Start with reviewed figures
Check for duplicate receipts, missing expenses and unpaid invoices before comparing periods. FigureLane can collect your paperwork and prepare an income statement from reviewed records.
Common questions
What happens when revenue is zero?
Profit is still revenue minus expenses. A percentage margin is undefined when revenue is zero, so the calculator shows no margin rather than dividing by zero.
Is this the same as taxable profit?
No. Taxable profit can differ because of allowances, disallowed expenses and other adjustments. This calculator shows the arithmetic of the income and expenses you enter.
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