Cash Flow Forecast Calculator

How to Build a Useful Cash Flow Forecast

A cash flow forecast shows when money actually arrives and leaves your bank account, month by month. That's different from profit. A business can be profitable on paper and still run out of cash if customers pay slowly or a large bill lands in the wrong month.

1. Start with your real bank balance today, not what you're owed.
2. Enter income in the month you expect to be paid, not the month you invoice. If customers take 30 days, push the income back a month.
3. List every outgoing: rent, wages, stock, loan repayments, subscriptions, and the ones people forget, like VAT, Corporation Tax or Self Assessment payments on account.
4. Look for the lowest point in the 12 months. That's the figure your overdraft or reserves need to cover.

Update it monthly with actual figures. The gap between forecast and reality is the most useful thing it tells you.

Frequently asked questions

What is the difference between cash flow and profit?

Profit is income minus costs for a period, whenever the money moves. Cash flow is the timing of money in and out of your account. Slow-paying customers or big upfront costs can leave a profitable business short of cash.

How far ahead should a cash flow forecast go?

Twelve months is a good standard, reviewed monthly. If cash is tight, a week-by-week forecast for the next 13 weeks gives earlier warning.

Should I include VAT in the forecast?

Yes, if you are VAT registered. Include VAT in your sales and purchases, then add the VAT payments to HMRC in the months they are due.