Enter your cost and the markup you want to add. You get the selling price, your profit, the equivalent margin and what the customer pays once 5% VAT is added.
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Markup is profit as a percentage of cost; margin is profit as a percentage of the selling price. A 50% markup on a cost of AED 100 gives a price of AED 150, which is a 33.3% margin — not 50%. Mixing the two up is one of the most common pricing mistakes, and it quietly erodes profit.
Markup % = (selling price − cost) ÷ cost × 100. To price from a markup, selling price = cost × (1 + markup ÷ 100).
Margin = (selling price − cost) ÷ selling price × 100. For the same sale, margin is always lower than markup. A 25% markup equals a 20% margin.
Add your markup first to reach the VAT-exclusive price, then add 5% VAT on top. VAT is collected for the Federal Tax Authority; it is not part of your profit.