A quote should be worked out, not guessed.

A price you've guessed at feels quick. It's the round number that sounds about right, the VAT added on at the end, the "market rate" borrowed from someone else's job. And it works, right up until the one you underpriced, the tax you got wrong, or the margin that turned out not to be there. Here's the other way to price a job.

What a guess actually costs

• The round number. "£4,000, that'll be fine." Then the skip, the waste and the day you didn't charge for turn it into £3,400 of real money in your pocket. And you've already sent the quote.
• The tax added last. VAT tacked on at the end, CIS forgotten, the Domestic Reverse Charge missed. The customer doesn't pay for that correction. Your margin does.
• Someone else's rate. A price averaged from other people's jobs doesn't know your day rate, your overheads or your patch. It fits their business, not yours.

Two ways to price a job

	Guessing it	Working it out
Where the price comes from	A round number that feels about right	Your own rates and day rate, line by line
VAT, CIS & the Reverse Charge	Added at the end, or missed	Applied to the HMRC rules as you build
Your margin	You find out on the final invoice	Shown before you send, on every job
When a mistake shows up	After you've committed to the price	On screen, while you can still change it
What the customer gets	A figure with nothing behind it	A costed quote that holds up to questions

Six days, and the £330 nobody puts in the price

Say the materials and labour come to £3,000, and the job takes six days. Your overheads work out at £55 a day: the van, the insurance, the phone, the evening doing paperwork. That is not a percentage of anything. It is six days of running your business, and it costs £330 whether the job goes well or badly.

So standing still on this job costs £3,330. Not £3,000.

• The round number. £3,300 feels about right, and it is under break-even. You have worked six days to be £30 worse off, and you will not find out until the job is done.
• Worked out. £3,000 plus 20% is £3,600, and the £330 goes on top: £3,930. Six days' work, £600 of actual profit, and the overheads already paid for.

Same job, same costs, £630 between the two prices. The gap is not greed. It is the bit of the arithmetic that has no line on any quote, so it gets left out of the ones that are guessed.

You never send that breakdown. Your customer sees clean prices against the work, because the £330 is spread across those line prices and never itemised. Your costs and your margin are nobody's business but yours. What you get on screen, while you can still change the number, is whether the price covers the first two, and when it stops covering them it says so in those words: this quote loses money.

How TradeDraft works it out

• Your rates, not an average. Overheads and margin come from your day rate and your costs, so the price fits your business, not a figure pulled from thin air.
• The tax by the rules. VAT, CIS and the Domestic Reverse Charge are applied the way HMRC expects, on the quote, not worked out later or left to chance.
• Checked before it goes out. You see what you actually keep, so you send the quote knowing the number holds up.

The deduction that isn't 20%

Here is the same nine-day bathroom, this time subcontracted to a main contractor. The reverse charge applies, so no VAT is charged; CIS comes off at 20%. This is the app's own panel, stamped here, not live — and your client never sees any of it.

Check two of those figures against each other. Twenty per cent of the £7,983 quote total would be £1,596.60. The deduction actually reads −£1,164.60 — because CIS is charged on £5,823, the quote total less the £2,160 of materials the deduction never touches. Two numbers that would be identical if it were done the lazy way, printed differently, in public.

The £432 between them is not a rounding difference. It is your money, and on a quote that deducts a flat 20% off the total it sits with the contractor until you square it up with HMRC at the end of the year. The reverse charge is the same shape of problem pointing the other way, and the document carries the wording HMRC expects for it — so the contractor accounts for the VAT, and nobody puts 20% on an invoice that should carry none.

What 10% on top actually leaves you

Same £5,760 of work, same nine days, this time for a private customer and priced with 10% on top instead of 30%. Nothing here is a mistake. Every cost is covered and the job makes money.

Read the bottom line. Nine days of work, and it is the sort of number you would agree to on the phone without blinking, because ten per cent on top sounds like profit. The point is not that the app refuses it — it is your price and you may have good reasons. The point is that you are told while the quote is still open, instead of working it out in January.

What "worked out" means

Worked out means the number is reproducible. It comes from figures you entered, run through the same rules every time, and you can see exactly how it was reached, the line totals, the tax and the margin all on the page. A price you can explain to a customer is a price you can stand behind when they push back. That's the difference between a quote and a guess with a confident voice on it.

See six real documents at full size, from the quotation to the invoice →

A guess is not always wrong

Someone asks for a ballpark over the phone and you give them one. That is fine, and it stays fine on a small cash job with no VAT and no CIS to get wrong. What changes it is a signature. Once the customer has accepted the number, you are living with it, and that is the moment you would rather have worked it out than guessed.

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Read next: the finished paperwork — the quotation through to the invoice, at full size.