One of the most important questions when it comes to business is “is turnover calculated before or after tax?” The answer to this question can have a significant impact on the way businesses operate and the amount of money they bring in.

In this blog post, we will explore the answer to this question in more detail. We will also provide some context about how taxes work and how they can impact businesses.

What is Turnover?

Turnover is a term used to describe the rate at which a company or individual sells and replaces their inventory. In other words, turnover is a measure of how often a business sells and replaces its entire stock of goods.

There are two types of turnover: gross turnover and net turnover. Gross turnover is the total value of all sales made by a company, while net turnover is the value of sales after discounts and returns have been deducted.

There are several ways to calculate turnover, but the most common method is to divide the total value of sales by the average value of inventory. This ratio can be expressed as a percentage, which allows businesses to compare their own performance against industry standards.

What are the Different Types of Turnover?


There are several different types of turnover, each with its own calculation. The most common type of turnover is gross turnover, which is simply the total revenue generated by a company before taxes and other expenses are deducted.

Other types of turnover include net turnover (revenue minus expenses), operating turnover (revenue minus operating expenses), and profit turnover (revenue minus all expenses).

How is Turnover Calculated?

There are a few different ways that companies calculate turnover, but the most common method is to simply divide the total sales by the number of employees. This gives you a rough idea of how much each employee is responsible for in terms of sales.

However, it’s important to note that this calculation doesn’t take into account the variability of individual employee performance or the overall profitability of the company.

Another way to calculate turnover is to look at the total revenue generated by the company and divide it by the average number of employees over a certain period of time. This method is a bit more accurate, but it can be more difficult to track if you don’t have access to detailed financial reports. Income tax calculator can also help you calculate turnover.


Finally, some companies use a formula that takes into account both sales and profits when calculating turnover. This ensures that only profitable employees are counted and that high performers are appropriately weighted. However, this method can be complicated to implement and may not be necessary for all businesses.

How Can You Reduce Your Turnover Rate?

There are a number of ways you can reduce your turnover rate:

  1. Improve your hiring process: Take the time to thoroughly screen candidates and only hire those who you are confident will be a good fit for your company.
  2. Onboard new employees effectively: Make sure new employees are properly trained and have all the resources they need to succeed in their role.
  3. Foster a positive work environment: Create an environment where employees feel valued and appreciated, and where they can see themselves advancing within the company.
  4. Invest in employee development: Offer opportunities for employees to grow and develop within their roles, and provide support for them to reach their full potential.
  5. Encourage open communication: Encourage open communication between managers and employees, and between employees themselves, so that problems can be identified and addressed quickly.