Net Income After Taxes (NEAT)
Net Income After Taxes tells you how much profit remains once the government has taken its share. "Net income" here is the profit figure you have arrived at, and "tax" is the amount the business must pay to the government based on that profit. This formula simply removes the tax from the net income so you can see the true, spendable amount.
To calculate it in words: take your net income and subtract the tax owed on it. What's left is the after-tax figure — the money the business can actually keep, reinvest, or distribute.
A higher result means more money survives taxation and stays with the business, which is what everyone hopes for. A lower result means a large slice went to taxes, leaving less to work with.
Project managers and finance teams use this number to compare projects fairly, because taxes affect how much value a project really delivers. Two projects might look equally profitable before tax, but the one keeping more after tax is the better performer.
Think of it like winning a prize that is taxable. The prize might be announced as $80,000, but once the tax is taken out, the amount you can actually deposit and use is smaller — and that smaller, real amount is what matters.
Suppose a project reports net income of $80,000. The tax owed on that income is $24,000. Net Income After Taxes = $80,000 − $24,000 = $56,000. This shows that although the project earned $80,000 on paper, only $56,000 is genuinely available to the business after the tax bill is paid.
Every PMP formula explained free — plus worked examples and practice in PMP Math, and full timed mocks in the simulator.