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Break-even calculator

How many jobs or sales a month do you need to cover your costs? Enter your monthly fixed costs, your average price and the direct cost of each job to find your break-even point and the jobs needed for a target profit.

The formula

Break-even jobs = fixed costs ÷ (price per job − direct cost per job). With £2,500 of fixed costs a month and £240 left from each £400 job after £160 of materials and fuel, you need 10.4 jobs, so 11, to break even. Every job after that adds £240 of profit before tax.

What counts as a fixed cost?

Costs you pay whatever happens: van finance, insurance, phone, software subscriptions, accountant, rent or storage. Decide whether to include your own drawings. If you do, break-even means covering your wages too, which is the more useful figure for a sole trader.

Using it

• Price too low? See the effect of a higher price straight away, then work out the rate you need with the day-rate calculator and how much to charge per hour.
• Costs rising? Use the price increase calculator.
• Thinking about a new subscription? It adds to fixed costs; the AI tool break-even calculator tests whether it pays for itself.

Questions

What is a break-even point?

The number of jobs or the level of sales where your income covers all your costs, so you make neither a profit nor a loss.

Should I include VAT?

No. Use prices and costs without VAT if you're VAT registered, because the VAT isn't yours.

Does this include tax?

No. Profit here is before Income Tax and National Insurance. Estimate those with the self-employed tax calculator.