How to use this calculator
- Enter initial outlay, annual net receipts, effective annual discount rate (%).
- Choose a display currency, then select Calculate. Results also update after a brief pause while you edit.
- Read the result with the assumptions below. Export details or save a second scenario to compare your choices.
Formula and method
Assumptions and limitations
Fractional-year interpolation assumes recovery is spread uniformly through the final year. Cash flows after recovery and overall project NPV still matter. No recovery within supplied receipts is labelled undefined.
Worked example
An initial 1,000 recovered through annual receipts of 600 reaches simple payback after 1 + 400/600, or about 1.6667 years; at a 0% discount rate discounted payback is the same.
What the result means
Compare simple and discounted recovery time for nonnegative annual receipts.
Common questions
How is the calculation performed?
Accumulate annual cash receipts until the initial outlay is recovered; prorate the final period. Repeat using discounted receipts for discounted payback.
What does the model leave out?
Fractional-year interpolation assumes recovery is spread uniformly through the final year. Cash flows after recovery and overall project NPV still matter. No recovery within supplied receipts is labelled undefined.
Methodology and transparency
Calculation specification reviewed on 2026-10-14. Mathematical implementation is tested against independent reference fixtures. This does not imply review by a licensed financial professional. Read the testing and precision policy.