Profit Margin and Markup Calculator
Enter cost and selling price without GST/HST or other sales tax. Sales tax is not revenue, so leave it out of both the margin and the markup. Use the sales tax calculator if a receipt only shows a total, then come back with the before-tax numbers.
Markup calculator
Margin and markup use the same three numbers: cost, price and profit. Switch mode to work forwards from a price, or backwards from a margin or a markup.
Enter numbers like 50 or 1,234.56.
Margin vs markup
People mix these up. Margin is profit as a share of the selling price. Markup is profit as a share of cost. The same product can show a 40% margin and a 66.7% markup.
| Example | $60 cost | $50 cost |
|---|---|---|
| Selling price | $100 | $75 |
| Profit | $40 | $25 |
| Margin | 40% | 33.3% |
| Markup | 66.7% | 50% |
The second example starts from a 50% markup on a $50 cost. The price becomes $75, and the margin on that price is 33.3%.
Break-even calculator
How many units do you need to sell to cover your fixed costs?
Enter numbers like 50 or 1,234.56.
This ignores GST/HST (not revenue), income tax, and one-off costs.
These calculators give an estimate for general information only and are not business, tax or accounting advice. They don't include sales tax, income tax, fees or one-off costs. Confirm pricing decisions with your own numbers or a qualified professional.
How to calculate profit margin
Profit margin is the share of the selling price you keep after cost. Subtract the cost from the price, divide that profit by the price, and multiply by 100.
A product that costs $60 and sells for $100 has $40 of profit. $40 divided by $100 is a 40% margin. Use the price before GST/HST. Sales tax you collect is not part of that price.
How to calculate markup
Markup looks at the same profit from the cost side. Divide profit by the cost, then multiply by 100. On a $60 cost and a $100 price, $40 divided by $60 is a 66.7% markup.
If you know the cost and the markup you want, the selling price is cost × (1 + markup ÷ 100). A $50 cost with a 50% markup is $75.
When to use margin vs markup
Use margin when you think about the price the customer pays. A 40% margin means 40 cents of every dollar of price is profit. It lines up with the selling price on an invoice.
Use markup when you start from what you paid and add a percentage. A 50% markup adds half of the cost on top, which is the usual way to build a price from a supplier invoice. The two percentages are not interchangeable. A 50% markup is a 33.3% margin.
Should prices include GST/HST?
No. These tools use amounts before sales tax. GST/HST you charge is collected for the government. It is not revenue. If you can claim the tax on supplies as an input tax credit, leave that tax out of the cost too. When a receipt shows only a total, use the sales tax calculator to take the tax out, then return with the before-tax numbers.
Break-even in plain English
Break-even is the point where the money you keep from sales covers your fixed costs. Fixed costs are the ones you pay even if you sell nothing, such as rent or software, for the month or year you have in mind. Variable cost is what you spend to deliver one more unit.
Contribution per unit is the selling price minus that variable cost. Divide fixed costs by the contribution to get the units you need to sell. If the price does not cover the variable cost, selling more will not get you there. The calculator rounds units up so you do not stop one sale short.
Questions
What is the difference between margin and markup?
Margin is profit as a share of the selling price. Markup is profit as a share of the cost. The same product can show a 40% margin and a 66.7% markup.
How do I calculate profit margin?
Subtract the cost from the selling price, then divide that profit by the selling price and multiply by 100. Margin = (price − cost) ÷ price × 100.
How do I calculate markup?
Subtract the cost from the selling price, then divide that profit by the cost and multiply by 100. Markup = (price − cost) ÷ cost × 100.
If my margin is 50%, what is my markup?
It is 100%. A $50 cost and a $100 selling price is a $50 profit. That is a 50% margin (50 ÷ 100) and a 100% markup (50 ÷ 50).
Should I include GST/HST in the cost or price?
No. Sales tax is not your revenue. Enter cost and selling price before GST/HST, and use the sales tax calculator separately.
What is break-even?
Break-even is the sales level where the contribution from each sale covers your fixed costs. Contribution is the selling price minus the variable cost, both before sales tax.