How this tool works
Margin and markup are different
The tool adds the cost inputs, then divides that cost by (1 − target margin) to find a selling price before VAT. At £800 total cost and a 25% target margin, the price is £1,066.67 and estimated gross profit is £266.67. That is a 33.3% markup on cost.
Applying 25% markup instead would produce a £1,000 price and only a 20% margin. This distinction helps prevent underpricing when you set a target margin.
Use realistic costs
Include labour, materials, travel, disposal, equipment, insurance and overhead allocation where appropriate. The tool does not provide market rates, estimate tax, include contingency automatically or decide VAT treatment.
Assumptions and limitations
This is a browser-based estimate using the figures and periods you enter. It does not verify a contract, decide legal validity, calculate tax liability or replace current HMRC guidance. Reviewed 7 October 2026.
Frequently asked questions
Is this a market-rate quote?
No. It prices the costs and margin you enter; it does not provide local labour or material rates.
What is the difference between margin and markup?
Margin is profit as a share of selling price; markup is profit as a share of cost.