Job Profit Margin Calculator for Tradies

How to work out your job margin

Your margin is the slice of the job price you actually keep once every cost is paid. Work it out in three steps:

1. Add up all your costs - materials, labour (hours multiplied by your true cost per hour, not your charge-out rate), plus other costs like hire, tip fees and subbies.
2. Take your revenue. If the quote includes GST, use the ex-GST figure (divide by 1.1). GST is money you collect for the ATO, so it is never yours to count as profit.
3. Subtract cost from revenue to get profit, then divide profit by revenue and multiply by 100. That is your margin percentage.

Markup vs margin (they are not the same)

This trips up a lot of tradies and quietly eats profit. Markup is profit measured against your cost. Margin is profit measured against your price. Same dollars, different base, different number.

Say a job costs you $10,000. Add a 20% markup and you charge $12,000 - but that $2,000 profit is only a 16.7% margin, not 20%. If you actually want a 20% margin, do not add 20%. Divide the cost by 0.8 instead: $10,000 / 0.8 = $12,500. That $2,500 profit on a $12,500 price is a true 20% margin.

The rule of thumb: to hit a target margin, divide your cost by (1 minus the margin). For 30%, divide by 0.7. For 25%, divide by 0.75. Adding the percentage on top always leaves you short.

Do this on every job, automatically

A calculator is great for checking one job before you send the quote. The harder part is knowing whether the margin held once the job is running and costs are creeping in. That is what TrackYaTradie does for you - set the job value once, log materials and hours as you go, and watch your live margin move in real time so you can act before a job goes underwater.

Want to go deeper? Read our guides on job costing for tradies and how to quote a carpentry job.