How long your cash lasts.

The number of months your business can keep going on the cash it has now, if nothing changes. It's the question to ask before you hire, sign a lease or wait on a slow-paying client.

Divide the cash in the bank by your net burn, which is monthly spend less monthly income. With €60,000 in the bank, €9,000 going out and €4,000 coming in each month, the net burn is €5,000, so the cash lasts 12 months.

Gross burn is everything you spend in a month. Net burn is gross burn less the income that comes in, so it's the amount your bank balance actually falls by. Runway uses net burn.

Yes. VAT you've charged customers sits in your account until the quarterly return, but it belongs to the Tax Department. Provisional tax and Social Insurance payments are due on fixed dates too. Take what you already owe off your cash before you work out the runway.

If income grows each month, the gap between spend and income shrinks, so the cash lasts longer. If income overtakes spending before the cash runs out, the business becomes cash-flow positive and the calculator shows the month that happens and how low your cash goes first.

It depends on how steady your income is. The less predictable it is, the more months you want in hand. Whatever the number, decide early what you'll do if it gets short: cut costs, chase what you're owed, raise prices or find funding. Each takes longer than it seems.