How to Price a Job as a UK Tradesperson (The Right Way)

Underquoting a job is one of the most common and costly mistakes in the trades. You spend days working, the customer pays — and somehow you're worse off than if you'd stayed at home. The culprit is almost always the same: a quote that didn't properly account for all the costs involved.

Pricing a job correctly means including everything: not just labour and materials, but travel, disposal, your markup on materials, your profit margin, and VAT if you're registered. Miss any one of these and you're subsidising the job out of your own pocket.

This guide shows you exactly how to build a complete, correct quote for any job.

The Structure of a Correct Job Quote

A correctly priced job has six components:

1. Labour cost

   Your day rate × estimated working days (or hours × hourly rate for small jobs). This must cover your target income, overheads, and tax — not just a rough figure.

2. Materials at cost + markup

   Materials at your purchase price, plus a markup of 15–30% to cover sourcing time, price risk, wastage, and cash flow. Never supply materials at cost.

3. Travel and parking

   HMRC allows 45p/mile for the first 10,000 miles (25p above). Parking and congestion charges should be passed on at cost or included in the quote.

4. Disposal and skip hire

   Trade waste removal has a cost — skip hire, tip runs (charged at your hourly rate for time), and waste carrier licence costs. Don't absorb these silently.

5. Profit margin

   A profit margin of 10–20% on the subtotal above. Profit is not the same as your take-home pay — it's the business's surplus for investment, cash flow, and rainy days.

6. VAT (if registered)

   If you're VAT-registered, add 20% to the total and make it clear in the quote whether the price shown is inclusive or exclusive of VAT.

Worked Example: Bathroom Refit

Here's how a properly structured quote looks for a medium-sized job:

Use our Job Quote Calculator to build a complete quote like this for any job — it handles the markup, profit margin, VAT, and travel cost calculations automatically.

Getting Labour Cost Right

Labour pricing is where the biggest errors happen. The most common mistake is using a rough figure — "I'll charge £200 a day" — without checking whether that rate is sufficient.

Your labour rate must be based on your actual minimum day rate: the rate that covers your target income, tax, and overheads, divided by your real number of billable days. See our How to Set Your Day Rate guide for the full calculation.

When estimating time, be realistic about job duration. Most jobs take longer than expected due to unforeseen complications, especially in older properties. Build contingency in:

• For straightforward, well-defined jobs: add 10% to your time estimate
• For jobs in older or unknown properties: add 20–30%
• For first-fix / second-fix jobs where access depends on other trades: add buffer for waiting time

Materials Pricing and Markup

Supplying materials at cost is one of the most common and expensive habits in the trades. When you source materials, you're spending time researching, ordering, collecting, and managing returns. That time has value. You're also taking on price risk — if materials go up between ordering and delivery, the difference comes out of your pocket.

A markup of 15–25% on materials is standard and widely accepted by customers. This is not profiteering — it's a reasonable charge for the service of sourcing and managing materials on the customer's behalf.

Markup vs Margin — Understanding the Difference

These two terms are often confused:

If you want a 25% margin (25% of what the customer pays is profit), you need a 33% markup on cost. Most tradespeople think in terms of markup — just be consistent. Our Materials Markup Calculator handles both.

Wastage

Never quote materials without including wastage. Cutting tiles, trimming skirting, and running cable always produces off-cuts. Standard wastage allowances:

• Tiles: 10–15% (more for diagonal patterns)
• Timber: 10–12%
• Cable and pipe: 10–15%
• Paint: 5–10% (depends on number of coats)
• Flooring: 10–12%

Travel and Access Costs

Travel is a legitimate job cost that should be included in every quote unless the job is a flat-rate repeat customer arrangement. Your options:

• HMRC approved mileage rate: 45p/mile for the first 10,000 miles per year, 25p after. Simple, widely accepted.
• Actual fuel cost: More accurate for high-mileage tradespeople, but requires more detailed calculation.
• Fixed travel allowance: A set daily travel charge (e.g., £30/day) that covers average travel to local jobs.

Also include: parking charges, congestion charge (London), Dartford Crossing, ferry crossings, or any other access costs for the specific job.

Waste Disposal

Trade waste cannot legally be taken to a household tip. You must either hire a skip (pass the cost on), or hold a waste carrier licence and use a commercial tip or registered waste transfer station.

Skip hire costs (UK, 2025): mini skip (2–3 cubic yards) £100–£200; builder's skip (6–8 cubic yards) £150–£300+, depending on location and contents. These should always be passed on to the customer, either as a separate line in the quote or included in your total.

Profit Margin

A profit margin is separate from your labour rate. Your labour rate covers your personal income and overheads. The profit margin is the surplus the business retains — for investment in tools, training, vehicle replacement, cash flow buffer, and growth.

A 10–20% profit margin on the job subtotal is appropriate for most sole traders. This is not greedy — it's what makes a business sustainable rather than a hand-to-mouth lifestyle. Customers who understand business will not baulk at this.

VAT in Quotes

Always be explicit about VAT in your quotes. The clearest approach:

• Show the net (ex-VAT) price
• Show the VAT amount as a separate line
• Show the total including VAT

If you're not VAT-registered, state "No VAT applies" on the quote — customers sometimes assume VAT is included and feel misled if it's later added.

The VAT threshold is £90,000 turnover in any 12-month rolling period (2025/26). If you're near this threshold, factor in the impact of registration on your pricing.

Fixed Price vs Day Rate Quotes

Choosing the right pricing structure for the job type matters.

When to quote a fixed price

Fixed price quotes work best when the job is clearly defined and you can accurately estimate the time and materials. Benefits: customers prefer certainty; you're rewarded for working efficiently; disputes about final cost are rare.

When to quote day rate / time and materials

Day rate or time-and-materials arrangements are appropriate when the scope is genuinely unknown — opening up floors or walls, fault-finding, extensive repairs, or any job where discoveries could change the work significantly. Be clear with the customer upfront that this is how it works, and provide updates when the scope changes.

What a Written Quote Should Include

A professional written quote should contain:

• Your business name, address, and contact details
• Your VAT number (if registered)
• Customer name and address
• Date of the quote and validity period (e.g., "valid for 30 days")
• Clear description of the work to be done
• Itemised breakdown of labour and materials
• Price — clearly stating whether VAT is included
• Payment terms (e.g., 30% deposit, balance on completion; or 14 days invoice)
• What is specifically excluded from the quote
• Your insurance details (PLI level)

Common Pricing Mistakes