What does this interest calculator work out?

The interest calculator works out the total interest and end value on a starting balance over a period you choose, using either simple interest (interest on the principal only) or compound interest (interest on the principal plus previously earned interest). It runs entirely in your browser — no data is sent anywhere.

What is the difference between simple and compound interest?

Simple interest is calculated only on the original principal. Compound interest is calculated on the principal plus any interest already earned, so it grows faster over time. For borrowing, compound interest means the cost rises faster if you carry a balance. For savings, it means your pot grows faster when interest is reinvested.

Interest calculator

Work out how much interest a balance earns or costs. Simple interest is charged only on the original amount; compound interest is charged on the balance including interest already added, so it grows faster.

Amount (£) Annual interest rate (%) Time (years) Interest type

Interest: —
Final balance: —

The formulas

Simple interest: I = P × r × t
Compound: A = P × (1 + r/n)^n×t

P is the principal, r is the annual rate as a decimal, t is the time in years, and n is the number of times interest is added each year.

Worked example

Hold £1,000.00 at 6% a year for 2 years. With simple interest you earn £120.00, giving £1,120.00. Compounding monthly you earn £127.16, giving £1,127.16 — a little more, because each month's interest then earns interest too.

Where to go next

Loan affordability self-check — before any borrowing decision.
Our business loan — the cost, the cap and who can apply.
Help with payments — if money is tight, talk to us early.
MoneyHelper — free, impartial money guidance backed by the government.
gov.uk Business Finance Support — grants and finance you may be eligible for.