One of the biggest mistakes small business owners make is setting random sales targets without ever working out whether those sales will actually give them the income and lifestyle they want.
“I want to hit £100k turnover this year!”
Brilliant.
But will that actually pay you properly? 👀
What matters is:
✅ What you need to take home personally
✅ The tax you’ll pay personally
✅ The tax the business will pay
✅ What your business costs to run
✅ How much profit is left after all of that
Most businesses are built the wrong way round
Business owners often start with:
“How much can I sell?”
Instead of:
“What do I actually need this business to give me?”
That one shift completely changes how you plan your pricing, sales targets and profitability.
Start with YOUR take-home pay first
Let’s say you want to personally receive:
£3,000 per month after tax
= £36,000 per year in your pocket
Sounds simple enough. But here’s the bit many business owners miss…
Your company can’t just make £36,000.
Because before you even see that money personally:
→ The business has overheads to pay
→ HMRC take corporation tax
→ and you will also pay dividend tax or PAYE tax personally
So the business usually needs to generate significantly more than your desired take-home pay.
A simple example
Imagine:
You want £36,000 per year personally AFTER tax
To achieve that, your company may actually need to pay you around £40,000 – £45,000 gross (depending on salary/dividend mix and your other income)
Your annual business overheads are £40,000
Your direct costs (cost of sales) are 30% of sales
Straight away your business now needs:
£45,000 for you
PLUS £40,000 overheads
= £85,000 before even considering direct costs.
But because 30% of every sale disappears in materials, subcontractors or delivery costs, the actual sales needed become much higher:
Required sales = 85,000 / 0.70 = 121,429
So, suddenly a business owner wanting to personally receive £36k after tax may actually need well over £120,000 of sales to make that happen.
And that’s before allowing for:
Corporation tax
VAT cash flow pressure
Pension contributions
Reinvestments
Savings
Growth plans
Unexpected costs
Which is exactly why we created our required sales calculator 💡
Most business owners have never actually sat down and worked this out properly.
They know:
👉🏼 what they WANT to earn
but not:
👉🏼 what the business actually needs to produce to achieve it.
So we created a really simple calculator that helps business owners work backwards from:
the take-home pay they want personally
the estimated personal tax involved
their business overheads
direct costs and profit margins
corporation tax allowances
… to calculate the level of sales they realistically need to generate.
Suddenly they can see:
Whether their pricing actually works
Whether their current sales targets are realistic
Why cash flow always feels tight
Why they’re busy but still not taking much money home
This is where better decisions start
Once you know your real required sales figure, you can make smarter decisions around:
✅ Pricing
✅ Profit margins
✅ Cost control
✅ Sales targets
✅ Staffing
✅ Growth plans
Instead of just hoping everything somehow works itself out by year end 🤭
Because successful businesses don’t grow by accident.
They grow by understanding the numbers behind the business.
You can download our calculator here 👉🏼 Sales Calculator