Free tool · Business finance
Margin & Markup Calculator
Work out selling price, markup and margin with GST, and convert markup to margin
- Free
- No signup
- Indian rules
Cost
· per unitMarkup
GST rate on the sale
Good to know
- Markup is profit on cost. Margin is profit on the selling price. The same rupee profit is always a smaller percentage as margin.
- Work margin on the price before GST. The GST you collect goes to the government, so it is not part of your sales.
- If you claim input tax credit, the GST on your purchase is not a cost, so leave it out of the cost price.
- A 25% markup gives a 20% margin, and a 100% markup gives a 50% margin.
Results
Selling price before GST
₹1,000.00
₹1,180.00 with 18% GST · profit ₹200.00 per unit
Taxable value
₹1,000.00
price before GST
GST at 18%
₹180.00
Price with GST
₹1,180.00
what the buyer pays
Profit per unit
₹200.00
Markup on cost
25%
Margin on price
20%
before GST
Working
Selling price = ₹800.00 × (1 + 25%) = ₹1,000.00
Profit = ₹1,000.00 − ₹800.00 = ₹200.00
Markup = ₹200.00 ÷ ₹800.00 = 25%
Margin = ₹200.00 ÷ ₹1,000.00 = 20%
Check: margin = markup ÷ (100 + markup) = 25% ÷ 125% = 20%
Common mistake: dividing the profit by the GST-inclusive price (₹1,180.00) gives 16.95%, which understates your real margin of 20%.
Per-unit estimate before overheads, discounts and income tax. GST rates depend on the HSN or SAC of what you sell; check the rate before quoting a price.
How it works
What this tool does.
Find the selling price from cost and markup, or from cost and a target margin, or find your markup and margin from cost and selling price. Handles prices that include or exclude GST, and works margin on the value before GST, not on the tax.
Choose what you know: cost and markup, cost and the margin you want, or cost and your selling price. Enter the cost before GST if you claim input tax credit on the purchase. If you enter a selling price, say whether it already includes GST. Pick the GST rate. The calculator takes GST out of an inclusive price, works profit, markup and margin on the price before GST, and shows the price the buyer pays with GST added. Every step is shown, along with the margin you would get by mistake if you divided by the GST-inclusive price, and a markup-to-margin table.
Rules and dates last reviewed: October 2026
Margin & Markup Calculator formula
Markup = profit ÷ cost × 100. Margin = profit ÷ selling price before GST × 100. Selling price from markup = cost × (1 + markup). Selling price from margin = cost ÷ (1 − margin). Price before GST from a GST-inclusive price = inclusive price ÷ (1 + GST rate). Margin = markup ÷ (100 + markup) × 100; markup = margin ÷ (100 − margin) × 100.
Worked example
A Pune electronics distributor buys an item for ₹800 before GST and claims input tax credit on it. It adds a 25% markup, and the item is taxed at 18% GST.
- Selling price before GST = ₹800 × (1 + 25%) = ₹1,000
- GST at 18% = ₹1,000 × 18% = ₹180, so the buyer pays ₹1,180
- Profit = ₹1,000 − ₹800 = ₹200
- Markup = ₹200 ÷ ₹800 = 25%
- Margin = ₹200 ÷ ₹1,000 = 20%. Check: 25 ÷ (100 + 25) = 20%
- Dividing ₹200 by the GST-inclusive ₹1,180 would give 16.95%, which understates the real margin
Quote ₹1,000 + GST (₹1,180 in all). The 25% markup is a 20% margin.
Sleet Accounting
Want this done on every invoice?
Sleet Accounting’s live profit and loss shows gross margin from your actual sales and purchase costs.
- GST on every lineSleet Accounting works out CGST, SGST or IGST from each item’s HSN rate as you bill.
- Documents that convertA quotation becomes the sales order, the challan and the invoice, without retyping.
- Dues you can seeReceivables and payables by age, settled against invoices with part payments and credit notes.
Questions
Margin & Markup Calculator, answered.
Something else? Message us on WhatsApp at +91 82001 72869 or write to sales@getsleet.cloud.
What is the difference between margin and markup?
Both measure the same profit. Markup compares it with cost; margin compares it with the selling price. On an item that costs ₹800 and sells for ₹1,000, the ₹200 profit is a 25% markup but a 20% margin. The margin is always the smaller percentage.
How do I convert markup to margin?
Margin = markup ÷ (100 + markup) × 100. A 25% markup is 25 ÷ 125 = 20% margin; a 50% markup is 33.33% margin; a 100% markup is 50% margin. To go the other way, markup = margin ÷ (100 − margin) × 100, so a 20% margin needs a 25% markup.
How do I find the selling price for a target margin?
Divide the cost by (1 − margin). For a 20% margin on a ₹800 cost, the price is ₹800 ÷ 0.80 = ₹1,000 before GST. Adding 20% to cost (₹960) would give only a 16.67% margin.
Should margin be worked on the price with GST or without?
Without. Under section 15 of the CGST Act the value of a supply does not include CGST, SGST or IGST charged separately, and the GST you collect is paid to the government. So profit and margin are worked on the price before GST. If your price includes GST, divide it by (1 + rate) first: ₹1,180 at 18% is ₹1,000 before GST.
Should the GST I paid on purchases be part of the cost?
Only if you cannot claim it back. If you claim input tax credit, the GST on your purchase is set off against the GST you collect, so your cost is the price before GST. If you cannot claim it, for example under the composition scheme or for an item where credit is blocked, include the GST in the cost.
What margin should I keep?
There is no single right figure: it depends on your trade, your overheads and what competitors charge. Work out the margin you need to cover rent, salaries and other fixed costs at your expected sales, then check whether the price that gives it is one your buyers will pay. The break-even calculator helps with the first part.
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