Cash Flow Forecast Generator

What a Cash Flow Forecast Tells You

A forecast follows money into and out of your bank account. Invoicing £10,000 does not give you £10,000 to spend today when the customer pays next month. Profit and available cash answer different questions: a profitable job can still need funding while you pay wages and suppliers.

This generator estimates opening and month-end balances over 3, 6 or 12 months. Use the lowest balance to identify a funding gap, the VAT reserve to recognise money still owed, and the scenarios to check how much room your plan has for a delay. It is a monthly planning model, so a positive month-end balance does not prove that every bill can be paid on its due date.

How to Enter Sales, Costs and Earlier Invoices

Enter sales excluding VAT. A 2% monthly growth assumption makes Month 6 sales about 10.4% higher than Month 1, because there are five compounding steps. Fixed costs are the cash you pay each month, including any VAT charged to you. Variable costs are cash payments expressed as a percentage of sales excluding VAT: £2,500 paid on £10,000 of net sales means 25%.

For an established business, earlier invoices are estimated from the same steady sales level. With Net 30 terms and £10,000 monthly sales, the forecast assumes £10,000 of earlier net invoices is collected in Month 1. This is an assumption, not a lookup of your accounts. Choose New business to start with no earlier invoices. Do not include the same unpaid invoice in both opening cash and expected receipts.

Understanding the Scenarios

Customers pay slower shifts the entire expected receipts schedule by one extra month. For flat sales of £10,000 a month, a six-month forecast then receives £10,000 less than the base case, before VAT. The missing final receipt is delayed beyond the window, not written off as a bad debt.

Sales 10% lower reduces new forecast sales and their variable costs; estimated invoices from before the forecast remain unchanged. Costs 10% higher increases both fixed and variable cash spending. Combined stress applies the sales reduction and the collection delay together. These scenarios change one stated assumption at a time so you can compare the balances, rather than treating a single projection as certain.

Currency and Country Scope

Use the currency button to choose the currency for your inputs, dashboard, monthly breakdown and saved results. Switching currency converts the amounts already entered using the dated reference rate; it does not replace your forecast. Enter your own figures in the selected currency.

The core forecast can be used internationally. The optional UK VAT model and tax guidance below apply to the UK only. Other countries’ VAT, GST, sales tax and filing schedules are not calculated. Leave UK VAT off if it does not apply and account separately for taxes omitted from the forecast.

Examples and UK legal thresholds remain in GBP. Currency conversion is an estimate at one reference rate, not a forecast of exchange-rate movements or a tax-return conversion method.

UK VAT: Receipts, Payment Timing and the Reserve

With VAT enabled, £10,000 of net sales at a 20% rate becomes £12,000 of customer receipts when paid. The £2,000 output tax accrues in the sales month. The standard UK VAT rate is 20%; choose the rate appropriate to your sales. Costs must already include the VAT you pay because this simplified forecast does not calculate input tax recovery.

Month 1 is assumed to start a new quarterly VAT period. GOV.UK explains the usual return and payment deadline. For a January-to-March quarter, that deadline is 7 May. In this model the first quarter is therefore paid in Month 5, then Months 8 and 11. This is a relative schedule, not your actual VAT calendar.

The reserve card shows output VAT from forecast sales that has not yet been paid. A three-month forecast can show no VAT payment while still owing £6,000 on £30,000 of net sales at 20%. Closing cash after reserve subtracts that unpaid amount. VAT from earlier periods is excluded: allow for it separately before using the forecast for an established VAT-registered business.

What to Do With a Tight or Negative Result

A negative opening balance matters even if Month 1 recovers. Shortfall means the opening or a month-end bank balance is below zero. Tight means the minimum balance, including the effect of unpaid forecast VAT, falls below your chosen safety buffer. Healthy means those checks pass under the assumptions entered; it is not a lending decision or guarantee.

If the lowest balance is £500 and your buffer is £1,000, the gap is £500. Review which receipts can realistically arrive sooner, which costs are discretionary, and whether committed funding covers the difference. For an overdraft or loan, use the provider's actual interest, fees and repayment schedule in a more detailed plan. This tool does not invent a borrowing quote.

Worked Example

An established business opens with £5,000, forecasts six months, invoices £10,000 a month with 2% growth, pays fixed costs of £4,500 and variable costs of 25%, and collects on Net 30 terms. VAT is off and the safety buffer is £1,000.

In Month 1, £10,000 of estimated earlier invoices arrives. Costs are £4,500 + £2,500 = £7,000, leaving £8,000 at month end. Across six months, receipts are £62,040.40 and costs £42,770.30, giving net cash of £19,270.10 and closing cash of £24,270.10. The lowest balance is the opening £5,000. The monthly average net cash flow is £3,211.68. Both the opening and monthly balances clear the buffer, so this case is Healthy.