How do I calculate net profit for my business?

Net profit is what remains after subtracting all business costs from total revenue. The formula is: Net Profit = Total Revenue – Cost of Goods Sold – Fixed Costs – Variable Costs – Taxes. If the result is positive, your business is making money. If negative, you are running at a loss.

What is a good profit margin for a small business?

A good net profit margin for a small business generally falls between 10% and 20%. Margins vary widely by industry — retail businesses often operate at 2%–5%, while service-based businesses like consulting or software can reach 20%–40%. The key is to track your margin consistently and compare it to your industry benchmark.

What is a break-even point and how is it calculated?

The break-even point is the level of revenue at which your business covers all its costs and makes zero profit. It is calculated as: Break-Even Revenue = Fixed Costs ÷ (1 – Variable Cost Ratio). Once you know your break-even, you can set sales targets that ensure profitability.

What is the difference between fixed and variable costs?

Fixed costs stay the same each month regardless of how much you sell — examples include rent, salaries, insurance, and software subscriptions. Variable costs change based on sales volume — examples include raw materials, shipping, payment processing fees, and sales commissions. Understanding both is essential for accurate business budgeting.

How often should a small business review its budget?

Most small businesses should review their budget monthly. Monthly reviews help you catch overspending early, compare actual results against your plan, and adjust forecasts for the coming months. Annual budgeting is useful for long-term planning, but monthly check-ins keep your business on track day to day.

Business Budget Calculator – Monthly Revenue, Fixed Costs, Variable Expenses, Net Profit & Break-Even Point

Business Budget Calculator

Enter your revenue, fixed costs, variable expenses, and tax rate to instantly see net profit, profit margin, break-even point, and cash flow — free business budget planner for any business size.

No data stored

Instant results

Mobile friendly

100% free

Standard accounting formula

Enter Your Budget Details

Revenue

Total Revenue ($)

Total sales or income before any costs

Cost of Goods Sold ($)

Direct product or service delivery cost

Fixed Costs

Rent / Office ($)

Salaries / Wages ($)

Insurance ($)

Software / Subscriptions ($)

Other Fixed Costs ($)

Loan payments, equipment leases, etc.

Variable Costs

Marketing / Ads ($)

Utilities / Bills ($)

Other Variable Costs ($)

Shipping, freelancers, commissions, etc.

Business Tax Rate (%)

Corporate or self-employment tax rate

Depreciation ($)

Monthly asset depreciation amount

Budget Period

Currency Symbol

Your Budget Results

Fill in your business income and costs on the left and click Calculate to see your full budget breakdown.

Net Profit (monthly)

$0.00

Profitable

Full Budget Breakdown

Total Revenue —

Gross Profit (after COGS) —

Total Fixed Costs —

Total Variable Costs —

Operating Profit (EBIT) —

Tax Withheld (est.) —

Depreciation —

Profit Margin —

Break-Even Revenue —

Total Costs (all) —

Budget Breakdown

Revenue vs Costs vs Profit

How This Calculator Works

This tool uses standard accounting formulas used by businesses worldwide. Here is how each result is calculated:

Gross Profit = Revenue − Cost of Goods Sold
Total Fixed Costs = Rent + Salaries + Insurance + Subscriptions + Other Fixed
Total Variable Costs = Marketing + Utilities + Other Variable
Operating Profit (EBIT) = Gross Profit − Fixed Costs − Variable Costs
Net Profit = EBIT − Taxes − Depreciation
Profit Margin = Net Profit ÷ Revenue × 100
Break-Even = Fixed Costs ÷ (1 − Variable Cost Ratio)

All values are per the selected period (monthly by default). Switch to annual or quarterly in Advanced Options.

Profit Margin by Industry

Industry	Avg. Net Margin	Typical Range
Software / SaaS	~20–30%	10–40%
Consulting / Services	~15–25%	10–35%
E-commerce / Retail	~2–5%	1–10%
Food & Beverage	~3–9%	2–15%
Construction	~5–10%	3–15%
Healthcare	~8–15%	5–20%
Freelancers	~20–50%	10–70%
Manufacturing	~5–12%	3–18%

Ranges vary by size, region, and market conditions. Use these as a starting benchmark only.

Fixed vs Variable Costs Explained

Fixed costs stay the same every month regardless of how much you sell or produce. They do not change with business volume.

Rent and office space
Employee salaries and payroll
Insurance premiums
Software subscriptions and licenses
Loan or lease repayments

Variable costs go up or down based on your sales or activity level. The more you sell, the more these tend to cost.

Marketing and advertising spend
Shipping and delivery fees
Freelancer or contractor payments
Payment processing fees
Utilities (if usage-based)

Break-Even Point Guide

Your break-even point is the amount of revenue your business needs to make in order to cover all costs with zero profit or loss.

The formula is:
Break-Even = Fixed Costs ÷ (1 − Variable Cost Ratio)

Where Variable Cost Ratio = Total Variable Costs ÷ Revenue.

Once you pass your break-even, every extra dollar of revenue becomes profit. Knowing your break-even helps you:

Set realistic monthly sales targets
Decide whether to raise or lower prices
Evaluate whether a new hire or cost is justified
Plan for slow months or downturns

Frequently Asked Questions

Net profit is your total revenue minus all costs — including cost of goods sold, fixed costs, variable costs, taxes, and depreciation. The basic formula is: Net Profit = Revenue − COGS − Fixed Costs − Variable Costs − Taxes. If the result is positive, your business is making money. If negative, you are spending more than you earn.

A net profit margin between 10% and 20% is generally considered healthy for a small business. However, margins vary by industry. Retail businesses commonly operate at 2–5%, while service businesses like consulting or software can see 20–40% or more. The most important thing is to track your margin over time and benchmark it against similar businesses in your field.

Gross profit is revenue minus only the direct cost of making or delivering your product or service (cost of goods sold). Net profit takes things further — it subtracts all remaining operating costs including rent, salaries, marketing, taxes, and depreciation. Gross profit tells you how efficient your core business is. Net profit tells you how much money you actually keep.

Monthly reviews are ideal for most small businesses. Reviewing monthly helps you catch overspending early, compare actual results to your plan, and adjust for the months ahead. Annual budgeting is great for long-term planning, but monthly check-ins are what keep your day-to-day finances on track. If your business is growing fast, consider reviewing cash flow weekly.

Your break-even point is the level of revenue where your total income exactly covers your total costs — no profit, no loss. Knowing this number helps you set realistic sales targets, price your products or services correctly, and plan for slow months. If your break-even is lower than your average monthly revenue, you have a buffer. If it is higher, you need to either reduce costs or increase sales.

Yes. Freelancers and sole traders can use this tool the same way as any small business. Enter your total monthly income as revenue, your home office or software costs as fixed expenses, and project-based costs like subscriptions or tools as variable costs. Add your self-employment tax rate in Advanced Options to see your estimated take-home. The profit margin and break-even results work the same regardless of business size.

Net Profit at Different Revenue Levels (Fixed Cost: $3,000/mo)

Assumes fixed costs of $3,000/month and variable cost ratios of 20%, 30%, and 40% of revenue.

Monthly Revenue	20% Var. Cost Net Profit	30% Var. Cost Net Profit	40% Var. Cost Net Profit	Margin (20%)

Formula: Net Profit = Revenue − Fixed Costs − (Revenue × Variable Cost Ratio). Currency: $.

Profit Margin Scenarios by Cost Structure

How much net profit you keep per $10,000 revenue under different cost combinations.

Fixed Costs	Var. Cost 15%	Var. Cost 25%	Var. Cost 35%	Var. Cost 45%

Revenue fixed at $10,000. Net Profit = Revenue − Fixed Costs − (Revenue × Variable Ratio). Green = profit, red = loss.

Break-Even Revenue by Fixed Cost & Variable Cost Ratio

How much monthly revenue you need to break even at different cost structures.

Fixed Costs/mo	Var. 10%	Var. 20%	Var. 30%	Var. 40%	Var. 50%

Break-Even = Fixed Costs ÷ (1 − Variable Ratio). Higher variable costs require much more revenue to break even.

Corporate Tax Rates by Country (Reference)

Standard corporate income tax rates around the world as a planning reference.

Country	Corporate Tax Rate	Small Biz Rate	Capital Gains	VAT / GST
🇺🇸 USA	21%	Pass-through (varies)	0–20%	Varies by state
🇨🇦 Canada	15% (federal)	9% (SBD)	50% inclusion	5% GST
🇬🇧 UK	25%	19% (small profit)	10–20%	20% VAT
🇦🇺 Australia	30%	25% (base rate)	50% discount	10% GST
🇩🇪 Germany	~30% (combined)	Trade tax varies	25%	19% VAT
🇫🇷 France	25%	15% (≤42,500€)	30%	20% VAT
🇮🇳 India	22–30%	25% (turnover-based)	10–20%	5–28% GST
🇸🇬 Singapore	17%	Partial exempt	0%	9% GST
🇳🇱 Netherlands	25.8%	19% (≤200k€)	31%	21% VAT
🇮🇪 Ireland	12.5%	12.5%	33%	23% VAT
🇧🇷 Brazil	34%	Simples Nacional	15–22.5%	~17% ICMS
🇿🇦 South Africa	27%	7–28% (turnover)	18%	15% VAT

Rates are standard statutory rates and may differ by entity type, size, or jurisdiction. Always verify with a local tax professional.

Annual Net Profit Projection

Estimated annual net profit based on consistent monthly revenue and cost ratios.

Monthly Revenue	Annual Revenue	Fixed (×12)	Variable 25%	Annual Net (25%)	Annual Net (35%)

Assumes $3,000/month fixed costs. Annual values = monthly × 12. No tax applied in this table.