Calculate how much revenue you need to cover your costs and become profitable.
Break-even is the point where your annual client revenue exactly covers your annual business expenses. At break-even, you’re not losing money — but you’re not making profit yet either.
When you sell services, the biggest question isn’t “How many units do I need to sell?” — it’s “How many clients do I need to cover my overhead?” Knowing your break-even client count helps you price confidently, avoid undercharging, and make realistic decisions about growth.
The basic formula is:
Because you can’t have part of a client, you usually round up to the next whole client.
If your annual business expense is $350 (hosting), and you charge $130 per client per year:
If you currently have 8 clients, your annual revenue is $1,040, and your annual profit (before tax) is $690.
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Start a ConversationEither works — just keep everything consistent. This calculator is designed around annual expenses and annual revenue per client. If you only know monthly expenses, multiply by 12.
Not yet. Break-even means your client revenue equals your business expenses. Profit begins only after you exceed your break-even client count.
Include costs that exist even if you have zero clients: hosting, domains, software subscriptions, accountant/bookkeeping, insurance, office costs, equipment, phone/internet (business portion), and any fixed retainers you pay.
Usually no. GST/HST is a pass-through tax collected on behalf of the government. Use your net revenue (before GST/HST) and your real business expenses.
Use your average annual revenue per client. If you have a mix of small and large clients, a quick approach is: total annual service revenue ÷ number of active clients.
This calculator is provided for informational and educational purposes only. It does not constitute financial, legal, tax, or business advice.
While reasonable efforts have been made to ensure accuracy, results are estimates based on the information you provide. Actual business performance may vary. You should consult a qualified professional before making financial decisions.
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