Overhead calculator for small business: add up what it costs to keep the doors open, then see the figure per month, per billable hour and per job.
Overhead is the part of your costs that does not care whether the phone rings. It is also the number most owners estimate from memory and get wrong by a third, usually because the van, the insurance and the software renew in months they were not thinking about.
Everything runs in your browser. Nothing you type is stored.
How to use it
- Work from last year’s bank statements, not from memory. Annualise anything you pay quarterly or yearly: insurance, accountant, vehicle servicing, subscriptions.
- Leave the direct job costs out. Materials, subcontractors and the hours on a specific job do not belong here. This is only the cost of being open.
- Add your real selling capacity. Billable hours a week and weeks worked a year. Twenty-five billable hours out of a forty-hour week is a realistic figure, not a pessimistic one.
- Read the per-hour number. That is what each billed hour has to carry before it contributes anything to profit or to you.
Why the per-hour figure matters more than the monthly total
A monthly overhead figure is easy to accept, because it arrives in familiar amounts. Spread across the hours you can actually sell it changes character: £1,285 a month sounds manageable, until it turns out to be £13.41 against every hour you bill, whether that hour is priced at £55 or at £30.
That second number is the one that decides whether a cheap job is worth taking. If you discount from £55 to £30 to win work, overhead does not shrink with the discount. It swallows a larger share of a smaller number, which is why discounting is the fastest way to turn a busy month into a poor one.
What belongs here and what does not
Belongs: rent or a workspace, insurance, the van and its running costs, phone and internet, software, marketing, accountant and legal, tools and their repair, training and memberships, bank and card fees, utilities, waste and storage.
Does not belong: materials for a particular job, subcontractors, plant hire for one project, or the wages of someone who only works when there is work. Those are direct costs, and the job profit calculator handles them at job level.
Where the numbers plug in
The annual total here is the fixed-cost figure the hourly rate calculator asks for, so use this tool first and carry the number across. The per-job figure is a quick sanity check when you are quoting: if overhead is £107 a job and you are quoting jobs at £400 with £250 of materials, the margin is thinner than it looks.
Once both are settled, the quote builder turns the price into a document, and the invoice generator collects it.
Mistakes that make the number too low
- Forgetting the irregular costs. Insurance, accounting and vehicle servicing are real, but they arrive once or twice a year and get treated as surprises instead of costs.
- Counting only what leaves the business account. Depreciation on tools and the van is a cost too, and replacing them is not free when the day comes.
- Using your busy-season hours. Spreading overhead across your best twelve weeks produces a rate that only works in the best twelve weeks.
- Ignoring your own admin time. Quoting, chasing and bookkeeping are unpaid hours that still consume the week and reduce the hours available to bill.
Questions
Does overhead include my own pay?
Not here. This tool covers business costs only. Your own income is a separate figure, and the hourly rate calculator is where the two meet: costs plus the pay you need, divided by hours you can sell.
Should I include a home office?
If you work from home, include the genuine business share of heating, electricity, internet and any space you have given up. What that share is depends on your local tax rules, so confirm the method with an accountant before you rely on the figure.
What is a normal overhead percentage?
There is no universal number. Service businesses with no premises often run under 15% of turnover, while those with a workshop, a vehicle and staff run considerably higher. What matters is knowing yours and pricing against it rather than discovering it at year end.
Why does the tool warn when overhead looks low?
Because a very low figure is usually a missing cost, not a lean business. If the result says below 12% of turnover, check rent, vehicle and insurance first.