How net margins work

With tax on, every vehicle shows two profit figures: the gross margin you are used to, and a net margin that estimates what you keep after tax. The net margin is the one to price against in a tax-inclusive market, because the gross figure can flatter a deal that still owes tax.

Gross, then net

• Gross margin = sale price minus landed cost (all your costs on the vehicle, including its share of shipment costs).
• Net margin = gross margin, adjusted for the tax impact.

The tax impact has two parts:

• Tax on the sale. Where your prices include tax, part of the sale price is tax you account for, so it comes off the margin.
• Tax you reclaim on costs. Where your tax is reclaimable, the tax sitting inside your reclaimable cost lines is added back, which lifts the margin.

Net margin is gross margin, minus the tax on the sale, plus the tax reclaimed on costs.

Where you see it

• On a vehicle's Financial summary, the profit reflects the net margin.
• On the Costs card, a net-margin figure breaks down gross, the tax impact, and net. Open it to see how the number was built.
• In Reports and on the Supplier pages, profit and margin use the same net figure, so the totals line up with the per-vehicle numbers.

A note on what these figures are

Every tax figure in the app is indicative, to help you judge margins and price with confidence. It is not a tax return and is not a statement of tax due. Use your accounting software for filing.

When net equals gross

If a vehicle has no tax data yet, or your tax is not reclaimable and your prices are quoted before tax, the net margin is the same as the gross margin. That is expected: there is simply no tax adjustment to make.