Revenue vs. Profit: The Definitions Behind the Buzzwords

april 3, 2026 

Let’s get right into it. Here are many of the accounting buzzwords you need to know as an entrepreneur. Because knowing your numbers gives you more confidence and allows you to understand where your money is going!

Revenue

Also known as your gross income, your revenue is the number that you make before taxes.

How much did your business bring in? What is the total amount in invoices and money that went into your business account.

That’s your revenue!

Profit

Also known as your net income, profit is your revenue minus your expenses.

This is the money left over after you’ve paid all your expenses.

You’ll see this as the amount on your tax forms for what you made for the year (aka your taxable income), but sometimes deductions can reduce this even more.

It does not include paying taxes or yourself (if you’re a sole proprietor or LLC).

Owner’s Pay/Draw

This is how much you pay yourself. Depending on your business structure (sole proprietorship, LLC, or S Corp), you may call this a salary or owner’s pay/draw.

I ALWAYS factor this in to pricing formulas and my numbers so that I make sure I’m paying myself to run this business — because if you’re not, what’s the fucking point?!

You deserve to be paid. Period.

Business Savings

This is the amount that remains after everything else.

That means the total in your bank account after you’ve paid expenses, yourself, and taxes for the year.

This can be your safety net or it can go towards investments for your business (like coaching!).

This is extra money for your business to spend however you need it.

Deductions/Write-Offs

First, I’m not an accountant — go find one for your business! It’s a worthy investment.

What I have gathered from working with accountants on my own business taxes for 8 years is that many things can be deductions — beyond what you pay for on a business credit card or spend on a project.

This means that my profit (revenue minus expenses) is technically different from my net income on my tax return.

Additional deductions I take include adding to my HSA (health savings account), car depreciation, home office square footage, coaching investments, and more.

That’s a wrap!

Want support going through your numbers? I’m here for that! I offer Fuck Yes! Pricing Audits to go over your pricing, programs like Pricing Like a Badass, and Curiosity Calls if you’re looking to explore more 1:1 support and want to see if we’d be a good fit!

I have fun, colorful spreadsheets and 9 years of working through my own numbers to help guide you towards understanding yours and setting new goals.

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