Cash Runway Mistakes Australians Make and How to Avoid Them

Updated 28 August 2026 · Business and gst

A Cash Runway Calculator gives a fast answer, but the answer is only as good as what goes in. These are the mistakes we see most often with cash runway calculations in Australia, and how to avoid them.

1. Forgetting on-costs

An employee costs well above their salary once super, workers comp and payroll tax are included.

2. Mixing up margin and markup

A 50% markup is a 33% margin. Pricing with the wrong one can erase profit.

3. Spending GST collected

GST belongs to the ATO. Keep it aside until your BAS is due.

4. Undercharging as a contractor

Your rate must cover super, leave, unbilled time and business costs, not just the salary you want.

5. Overlooking the detail that matters most here

Remember BAS, PAYG and super payments when estimating burn. They are easy to forget until they fall due.

How the cash runway changes with monthly net burn

A common mistake is getting one input slightly wrong. Here is what happens to the cash runway when “Monthly net burn ($)” is off by up to 20% in either direction, with everything else held steady.

Monthly net burn ($)	Cash runway
6,400	7.8 months
7,200	6.9 months
8,000	6.3 months
8,800	5.7 months
9,600	5.2 months

At 6,400 the result is 7.8 months; at 9,600 it is 5.2 months. If a small change in this input moves the answer a lot, it is worth double-checking that figure before you rely on the result.

A quick sense check

Runway = cash ÷ monthly net cash outflow. With typical inputs the calculator returns cash runway of 6.3 months. If your own result looks wildly different, check that each figure is in the right unit and period (weekly, monthly or yearly) before drawing conclusions.