Financial Clarity Made Simple

Profit & Loss Statement Template

Track income, expenses, and profitability for any business. Monitor financial performance with a professional P&L statement that works for sole traders, freelancers, small businesses, and growing companies.

Suitable for All Business Types
Two-Year Comparative Analysis
Automatic Profit Calculations
Provides figures for Tax Return

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MTD Income & Expenses

MTD Ready

Revenue Tracking

Cost of Goods Sold Section

Operating Expenses Categories

Net Profit Calculation

Track Every Pound In & Out of Your Business

Stop guessing about business performance. This template calculates profitability automatically and shows you exactly where the money goes.

Revenue tracking for sales, services, and other income streams
Complete expense categories (admin, marketing, salaries, utilities, insurance)
Cost of goods sold section (removable for service businesses)
Automatic gross profit calculation
Operating profit calculation from core business activities
Net profit after all income, expenses, and tax
Two-year comparative analysis to spot trends and growth
Provides figures for tax return
Fully editable Excel template with built-in formulas

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Section 1: Income Records

Details about income tracking and categorization go here. This section helps you maintain accurate records of all your income sources.

Section 2: Expense Categories

Comprehensive expense tracking with pre-defined categories that align with HMRC requirements. Each category is clearly labeled and easy to understand.

Section 3: Quarterly Summaries

Automatic quarterly calculations that prepare your data for digital submission to HMRC. No manual calculations required.

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Busy But Broke: Why Your Business Isn’t Making Money

Strong sales don’t guarantee profit. Without proper P&L tracking, hidden expenses drain profitability, pricing decisions lose money, and you miss tax deductions worth thousands annually.

Here’s what at stake.

Strong sales don't guarantee profit when expenses are hidden. Product businesses forget to track cost of goods properly. Service businesses charge hourly rates that don't cover overhead. You're working full-time but the bank account stays empty.

Without comprehensive tracking, you miss deductions for equipment, software, professional development, travel, and home office costs. You overpay tax because you cannot prove legitimate expenses to HMRC when filing returns.

Banks require P&L statements showing consistent profitability before approving loans or credit facilities. Without documented profit history over 2-3 years, applications get rejected regardless of how strong your revenue looks.

You cannot calculate true profit margins without knowing all costs. Product businesses price below cost after forgetting packaging, shipping, and platform fees. Service businesses charge rates that don't cover time, overhead, and taxes.

No visibility into year-on-year growth or which revenue streams actually make money. You make investment decisions based on intuition rather than data, expanding unprofitable products while cutting profitable ones.

Profit & Loss Template Essentials for Business Owners

Here's what each section means for your business and why tracking matters.

Revenue − Expenses = Profit

Revenue

All Income Generated

This shows all income your business generates. Total revenue indicates business size but doesn't reveal profitability.

Revenue Includes

Product sales Service fees Consulting work Subscriptions Interest earned Grants

−

Expenses

All Business Costs

This shows all costs required to run your business. Most owners underestimate total expenses by forgetting smaller recurring charges.

Expenses Include

Cost of goods Rent & utilities Salaries Marketing Insurance Software Equipment Professional fees

Profit

Money You Actually Keep

This is actual money remaining after all income and expenses, calculated as Revenue minus Expenses. Your net profit margin reveals if the business genuinely builds wealth.

Gross Profit

After direct costs

Operating Profit

After business expenses

Net Profit

After tax (final amount)

Get Your Profit Picture with This P&L Template

Download and Customize

Open the template in Excel or Google Sheets. Add your business name. Service businesses can delete the "Cost of Sales" section and go straight from Revenue to Administrative Expenses.

Record Income and Expenses

Enter revenue by category: sales for products, service revenue for consulting or freelancing, other revenue for grants or interest. Record every business expense in the correct category. Profit calculations happen automatically.

Analyze and Make Decisions

Compare current year to prior year to spot trends. Calculate your net profit margin to see what percentage you actually keep. Identify expensive categories eating profit. Use your P&L for tax returns, loan applications, and pricing decisions.

Get Clear on Your Business Finances

Download the free profit & loss template. Track all income and expenses to understand what’s working, waht’s costing you, and where to focus next.

Download Free Template

Frequently Asked Questions

Find answers to common questions

What's the difference between a P&L statement and a balance sheet? ▼

A P&L shows profitability over a time period: how much you earned, spent, and kept as profit. A balance sheet shows your financial position at one point in time: what you own, owe, and your net worth. P&L shows if you make money; balance sheet shows if you're building value.

Do I need the Cost of Goods Sold section if I run a service business? ▼

No. Consultants, freelancers, and service providers with no inventory can delete the Cost of Goods Sold section. Your P&L goes straight from Revenue to Administrative Expenses. Just remove sections that don't apply to your business.

How often should I update my profit & loss statement? ▼

Update annually at minimum before tax deadlines. Quarterly updates help spot trends early. Monthly tracking is best for active businesses to catch problems before they escalate. Stay consistent with whichever frequency you choose for accurate comparisons.

What's the difference between gross profit and net profit?▼

Gross profit is revenue minus cost of goods sold. It shows profit after direct product costs but before operating expenses. Net profit is what remains after all expenses including admin costs, interest, and tax. Net profit is the actual money your business keeps and the figure that matters most.

What if my business has multiple income streams or product lines? ▼

Create separate P&Ls for each income stream to identify which are profitable, then consolidate them. Or add line items to break down sales by product. This shows which parts make money and where to focus.