Profit margin and markup calculator

How is profit margin calculated?

Margin = (price − cost) ÷ price × 100. It is the share of the selling price that is profit. With a €60 cost and a €100 price, profit is €40 and the margin 40%.

What is the difference between margin and markup?

Both use the same profit, but margin measures it on the price and markup on the cost. With a €60 cost and a €100 price, margin is 40% and markup 66.67%. A 50% markup equals a 33.33% margin: they are not interchangeable.

How do I calculate the selling price from a margin?

Price = cost ÷ (1 − margin). With a €60 cost and a 40% margin: 60 ÷ 0.60 = €100. If you apply a 40% markup on cost instead, the price would be €84.

Does the price include VAT?

No. This calculator works without VAT; VAT is added when you invoice (you can work it out with the VAT calculator).

Worked example: a product costing €60

Sold at €100: profit €40; margin 40 ÷ 100 = 40%; markup 40 ÷ 60 = 66.67%. For a 40% margin: 60 ÷ (1 − 0.40) = €100. For a 50% markup: 60 × 1.50 = €90.

How to use this tool

1. Enter the cost of your product or service.
2. Choose whether you know the price, the margin or the markup and enter its value.
3. Read the price, profit, margin and markup.

Frequently asked questions

How is profit margin calculated?

(Price − cost) ÷ price × 100.

How do I calculate markup?

(Price − cost) ÷ cost × 100.

Can margin be 100%?

No: it would mean a zero cost. Margin on price is always below 100%. Markup can exceed 100%.

Does the result include VAT?

No: it works with prices excluding VAT.

Keep reading

• How to calculate Spanish VAT on an invoice
• How to read a Spanish invoice
• Spanish VAT calculator
• VAT and IRPF withholding calculator for invoices
• Free invoice generator
• Freelance hourly rate calculator
• All free tools

Reviewed on 6 November 2026. Indicative result: it does not replace an advisor's advice.