Cash flow forecast calculator, 2026/27

How this is calculated

A cash flow forecast starts with the cash actually in the bank, the opening balance, then adds expected cash receipts and subtracts expected cash payments for each period. Unlike a profit and loss account, it ignores accruals and depreciation entirely and only cares about money moving in and out of the bank account.

This calculator applies a constant net monthly movement, receipts minus payments, to the opening balance for the number of months requested, and tracks the running balance to flag the lowest point and the first month it would turn negative if nothing changes.

The net monthly movement is the single most useful number here: a small positive figure leaves little buffer against a late-paying customer or an unexpected bill, while a negative figure means the company is burning cash and needs either more sales, slower payments out, or external finance.

Why cash flow forecasting matters more than profit

A company can be profitable on paper and still run out of cash, most commonly because customers pay slowly while suppliers, PAYE and VAT need paying on fixed dates. Corporation tax is also due nine months after the year end regardless of whether the cash from that year's profit is still in the bank.

Lenders, invoice financiers and even suppliers offering credit terms will often ask to see a cash flow forecast before extending facilities, so keeping a rolling forecast updated is useful well beyond internal planning.

Improving the picture

The main levers are getting paid faster, through shorter payment terms, deposits or invoice finance, negotiating longer terms from suppliers, and timing large capital spending to avoid clashing with tax payment dates. Even modest improvements in average payment time from customers can transform a tight cash position.

Where a shortfall is forecast, options include arranging a business loan or overdraft in advance rather than in a crisis, factoring or discounting invoices to release cash tied up in debtors, or simply delaying discretionary spending until the position recovers.

What is the difference between profit and cash flow?

Profit measures income earned less costs incurred over a period, including non-cash items like depreciation and amounts invoiced but not yet paid. Cash flow measures only money that has actually moved in or out of the bank account, so the two figures can differ substantially in any given month.

How often should I update a cash flow forecast?

Monthly at a minimum, and weekly if cash is tight or you are growing quickly. Replacing forecast figures with actual results as they come in, and rolling the forecast forward, keeps it a useful decision-making tool rather than a one-off exercise.

Should I include corporation tax and VAT in the forecast?

Yes, ideally as separate lines rather than folding them into general payments, since they fall due on fixed statutory dates that do not move with your trading pattern and are easy to forget when cash looks healthy day to day.

What can I do if the forecast shows a shortfall?

Options include accelerating customer collections, negotiating supplier payment terms, arranging a business loan or invoice finance facility ahead of time, and reviewing discretionary spending, ideally acting weeks before the shortfall is projected to occur rather than after it happens.