Profit & Loss Calculator
Build a simple P&L statement. Enter revenue, COGS and overheads to see gross and net profit margins.
Last updated: April 2026 · Source: GOV.UK – Annual Accounts
| Revenue | £120,000.00 |
| Cost of Goods Sold | -£45,000.00 |
| Gross Profit | £75,000.00 (62.50%) |
| Wages | -£35,000.00 |
| Rent | -£12,000.00 |
| Utilities | -£3,000.00 |
| Marketing | -£5,000.00 |
| Insurance | -£2,000.00 |
| Other | -£5,000.00 |
| Net Profit | £13,000.00 (10.83%) |
Disclaimer
This calculator is provided for informational purposes only and should not be considered as financial or tax advice. All calculations are performed locally in your browser — no personal data is collected or sent to our servers. Rates and thresholds are sourced from HMRC and GOV.UK and are updated for the current tax year. Always verify results with HMRC or consult a qualified professional before making financial decisions.
How It Works
A Profit and Loss (P&L) statement, also called an income statement, summarises revenue and expenses over a specific period to show whether the business made a profit or loss. The structure follows a cascading format: Revenue (or turnover) minus Cost of Goods Sold (COGS) equals Gross Profit. COGS includes all direct costs of delivering your product or service—materials, direct labour, manufacturing overheads, and freight-in.
Gross Profit minus operating expenses (overheads) equals Operating Profit (EBIT). Overheads cover rent, utilities, salaries of non-production staff, marketing, insurance, depreciation, professional fees, and administrative costs. Operating Profit minus interest and tax equals Net Profit—the bottom line. Each level reveals different aspects of performance: gross margin shows production efficiency, operating margin shows management effectiveness, and net margin shows overall profitability after all obligations.
Key ratios derived from the P&L include: Gross margin = Gross profit ÷ Revenue × 100; Net margin = Net profit ÷ Revenue × 100; and the Overheads ratio = Total overheads ÷ Revenue × 100. Comparing these ratios month-on-month and against industry benchmarks identifies trends. A rising gross margin but falling net margin, for example, indicates overhead costs are growing faster than revenue—a common scaling problem. UK limited companies must file accounts including a P&L with Companies House annually.
Monthly P&L for a small e-commerce business
- Revenue: £28,000 from product sales.
- Cost of Goods Sold: product cost £11,200 + shipping £1,400 + packaging £600 = £13,200. Gross profit: £14,800 (52.9% margin).
- Overheads: rent £750 + staff £4,500 + marketing £2,200 + software £350 + insurance £150 + accountant £200 = £8,150.
- Operating profit: £14,800 − £8,150 = £6,650 (23.8% margin).
- Interest: £120. Net profit before tax: £6,530 (23.3% net margin).
Source: GOV.UK – Annual Accounts
Frequently Asked Questions
- What does the Profit & Loss Calculator do?
- Build a simple P&L statement. Enter revenue, COGS and overheads to see gross and net profit margins. All calculations are performed in your browser using official UK rates and thresholds.
- Is this suitable for my business?
- This calculator provides general estimates based on standard UK business rates and rules. Every business is different — consult your accountant for advice specific to your circumstances.
- Does this use 2025/26 tax rates?
- Yes. All rates and thresholds are based on the current 2025/26 UK tax year. Corporation Tax main rate is 25% for profits over £250,000, with a 19% small profits rate.