METHOD & GUIDANCE
How this calculation works
Keep every input on the same time basis—for example, one month or one financial year—and do not mix cash figures with accrual figures. Tool IQ recalculates every output immediately; nothing you enter is saved or sent to us.
How to use the result
Protect a safety buffer first, then compare base, lower-income and cost-reduction cases to set an action trigger before cash becomes urgent.
Worked example
The opening case protects 10,000 from a 50,000 balance and burns 6,000 net each month, leaving about 6.7 months of usable runway.
Common mistakes
- Using accounting profit instead of cash movement.
- Ignoring one-off payments and collection timing.
- Treating the protected buffer as spendable runway.
Frequently asked questions
Is the cash runway calculator free?
Yes. It requires no account and stores no calculation inputs.
Can I use the answer for a formal filing?
No. It is a planning estimate, not accounting, tax, legal or investment advice. Confirm material decisions with a qualified professional.
Which period should I use?
Keep every input on the same basis—for example, one month or one financial year. Use current figures first, then save a cautious scenario for comparison.
Continue the decision
- Break-even Calculator — Find the sales volume needed to cover every cost.
- Contribution Margin Calculator — See how much each sale contributes to fixed costs.
Popular small-business decision paths
- Build the next cash-flow forecast
- Measure how quickly invoices become cash
- Calculate UK late-payment interest
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Method reviewed 5 August 2026. Figures are illustrative and calculated locally in your browser. Official sources are linked where a rule or obligation affects how the result should be used. Read the Tool IQ calculation standard for our checking process, limitations and corrections policy.