Free tool
Business software cost calculator
Work out what a per-user subscription really costs in its first year and every year after, compare monthly and annual billing, and include the setup fees and add-ons that pricing pages tend to bury.
Your estimate
Enter the price per user to see your first-year and recurring costs.
First-year total
| Cost | Monthly billing | Annual billing |
|---|
Estimates only. Excludes sales tax, payment-processing fees and mid-year changes to your number of users. Always confirm prices on the vendor's current pricing page.
How the calculation works
Every figure comes from four simple formulas. Nothing is sent to a server; the math runs in your browser.
- Subscription per year = price per user per month × number of users × 12
- Recurring add-ons per year = monthly add-ons × 12 + yearly add-ons (multiplied by users if charged per user)
- Annual recurring cost = subscription per year + recurring add-ons per year
- First-year total = annual recurring cost + setup fees + one-time add-ons
"Charged per invoice" shows what lands on each bill: one month's subscription for monthly billing, or the full year up front for annual billing. Add-ons are excluded from that line because vendors bill them in different ways.
Assumptions and limits
- Prices are entered per user, per month, which is how most software vendors advertise both monthly and annual plans.
- Your number of users stays the same for the whole year.
- Sales tax, currency conversion and payment-processing fees are not included.
- Introductory discounts that end after the first term are not modeled. If a price rises at renewal, run the calculator again with the renewal price.
Monthly vs. annual billing: what to weigh
Annual billing is usually cheaper per month, but you commit to a full year and pay it up front. That makes sense when you are confident in the tool and your team size is stable. Monthly billing costs more over a year but lets you add or remove users, or leave, without losing a prepaid balance.
A useful rule of thumb: if you are still evaluating a tool or expect your headcount to change in the next few months, start on monthly billing and switch to annual once things settle.