Net Income Calculator — Bottom-Line Profit
Find the bottom-line net income of a business in seconds. Enter revenue, cost of goods sold, operating expenses, interest expense and the effective tax rate — the calculator walks step by step through gross profit, EBIT and EBT to reach the final net income and net profit margin.
%
Bottom-line profit after all costs, interest and taxes
- 1
Gross profit
500,000 − 200,000 = 300,000 - 2
Operating income (EBIT)
300,000 − 100,000 = 200,000 - 3
Earnings before tax (EBT)
200,000 − 20,000 = 180,000 - 4
Income tax
180,000 × 25% = 45,000 - 5
Net income
180,000 − 45,000 = 135,000
How does this calculator work?
Net Income = Revenue − COGS − Operating Expenses − Interest − Taxes. Enter those five figures and get the step-by-step income statement: gross profit, EBIT, EBT and the final bottom-line profit or loss. A flat effective tax rate applies to positive EBT only.
Formula
How this is calculated
Net income is what remains of revenue after every expense is deducted. The income statement follows three steps: Revenue minus the direct cost of producing goods (COGS) gives Gross Profit; subtract operating expenses such as salaries, rent, depreciation and R&D to get Operating Income (EBIT); subtract interest paid on debt to reach Earnings Before Tax (EBT); apply the corporate tax rate to EBT to get the tax liability; subtract it to get Net Income — the "bottom line."
A key assumption is that the tax rate is applied only to positive EBT — a loss generates no tax payable (though in practice, loss carry-forwards and deferred taxes add complexity). The calculator uses a flat effective tax rate rather than a progressive statutory schedule, which is appropriate for quick financial modelling and scenario planning.
Net income is the starting point for many other metrics: earnings per share (EPS) divides it by shares outstanding; net profit margin divides it by revenue; return on equity (ROE) divides it by shareholders' equity. A negative result (net loss) signals the company is spending more than it earns at the current scale.
Frequently asked questions
Gross profit is revenue minus only the direct cost of goods sold (COGS). Net income goes further: it also subtracts operating expenses (SG&A, R&D, depreciation), interest on debt, and income taxes — making it the most complete measure of profitability on the income statement.
COGS covers costs directly tied to producing each unit — raw materials, direct labour, and manufacturing overhead. Operating expenses (SG&A) cover running the business: non-production salaries, rent, marketing, and depreciation of non-production assets. The boundary varies by industry and accounting policy.
Yes. A net loss occurs when total costs exceed revenue. Early-stage or cyclical businesses often report net losses; they can still survive if they have positive operating cash flow or sufficient funding, but persistent losses erode equity and require financing.
Also known as
TG we-Calculate Editorial Team. (2026). Net Income Calculator — Bottom-Line Profit [Online calculator]. TG we-Calculate. https://we-calculate.com/calculator/net-income-calculator
TG we-Calculate Editorial Team. "Net Income Calculator — Bottom-Line Profit." TG we-Calculate. 2026. https://we-calculate.com/calculator/net-income-calculator.
TG we-Calculate Editorial Team, "Net Income Calculator — Bottom-Line Profit," TG we-Calculate, 2026. [Online]. Available: https://we-calculate.com/calculator/net-income-calculator
@misc{wecalculate_net_income_calculator, title = {Net Income Calculator — Bottom-Line Profit}, author = {{TG we-Calculate Editorial Team}}, howpublished = {\url{https://we-calculate.com/calculator/net-income-calculator}}, year = {2026}, note = {TG we-Calculate} }
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