Profit Margin + VAT Calculator
Set the right selling price for your products or services. Enter your cost price, desired profit margin, and VAT rate to see the net selling price, VAT amount, gross total, and your profit.
Calculator
Formulas
Selling Price (net) = Cost × (1 + Margin% ÷ 100)
Profit = Selling Price (net) − Cost
VAT = Selling Price (net) × VAT% ÷ 100
Selling Price (gross) = Selling Price (net) + VAT
Margin vs. markup
Profit margin is calculated as a percentage of the selling price, while markup is calculated as a percentage of the cost. This calculator uses margin: if you enter a cost of 100 and a margin of 30%, the selling price will be 142.86 (not 130).
For markup-based pricing, the formula would be: Selling Price = Cost × (1 + Markup%).
Why this matters for businesses
- Consistent pricing: Ensure every product covers costs and delivers the target profit.
- Competitive offers: Quickly model different margin scenarios to stay competitive.
- Tax compliance: Always show the correct VAT on your invoices.
- Quotation speed: Generate accurate quotes for clients in seconds.
How the margin + VAT tool works in practice
Enter your cost, the target profit margin %, and the VAT rate. The calculator derives the net selling price that delivers that margin, then adds VAT to show the gross customer price and your profit in euro. Use Albania 20%, Kosovo 18%, or Italy 22% for local quotes. Remember margin is a percentage of selling price, not of cost — a 30% margin on a €100 cost is not €130.
Worked EUR examples
— 30% margin, Albania 20%
Cost €100. Net selling price = 100 ÷ (1 − 0.30) = €142.86. Profit = €42.86. VAT = €28.57. Gross = €171.43.
— 25% margin, Kosovo 18%
Cost €80. Net SP = 80 ÷ 0.75 = €106.67. Profit = €26.67. VAT = €19.20. Gross = €125.87.
— 40% margin, Italy 22%
Cost €50. Net SP = 50 ÷ 0.60 = €83.33. Profit = €33.33. VAT = €18.33. Gross = €101.66.
If you accidentally used markup (cost × 1.30) instead of margin on Example 1, you would quote €130 net and only earn €30 — short of the 30% margin target.
When to use it / who it is for
- Retailers and wholesalers setting shelf prices with a target margin and local VAT.
- Agencies and freelancers pricing projects so the fee covers a planned profit after VAT.
- Founders building price lists that stay consistent across SKUs.
- Anyone who confuses margin with markup and wants a euro check before publishing.
Common mistakes
- Using markup maths while calling it margin (30% of cost vs 30% of selling price).
- Adding VAT to cost instead of to the net selling price.
- Ignoring that VAT is not profit — the tax line is collected for the authority.
- Mixing Albania/Kosovo/Italy rates on a single domestic price list.
FAQ
Margin or markup — which does this tool use?
Margin: selling price is derived so profit ÷ selling price equals the % you entered (for true margin). Cross-check the on-screen formula box.
Should VAT be inside the margin target?
No. Set margin on the net price, then add VAT. Mixing tax into margin quietly shrinks real profit.
Can I start from a gross shelf price?
Strip VAT first with the main calculator, then verify whether that net still meets your margin on cost.
Need a simple add/remove VAT check?
Open the main VAT calculator for Albania 20%, Kosovo 18%, or Italy 22% on any single EUR amount.
Pricing helper only. TVSH.AL is not a tax authority or accounting firm — confirm margin policy and VAT codes with your accountant before publishing a price list.
Keep a short audit trail: copy the tool outputs into the quote or spreadsheet, note the rate and date, and re-run the numbers if the client changes quantity or currency. Small EUR rounding differences of one cent are normal; align the VAT line so net plus tax equals the gross total printed on the document you send.