What profit margin should a UK independent garage make?

The UK vehicle repair trade keeps about 14.5 pence of every pound of turnover as operating profit, before business rates, depreciation, interest and tax. Before wages it keeps 35.2 pence, which is the closest official thing to a gross margin. Both figures are for 2024, the most recent year published by the Office for National Statistics, and one ONS usually revises when it publishes the next year. 14.5 percent is also the ten-year average, so it is a benchmark rather than a fluke.

Most owners can tell me their turnover to the nearest thousand and not their margin at all. Turnover tells you how busy you were. Margin tells you whether being busy was worth it.

The three numbers that answer the question

These come from the ONS Annual Business Survey, dataset "Non-financial business economy, UK: Sections A to S", Division 45 table, released 26 May 2026, covering 2024 alongside revised 2023 results. SIC 45.2 is "maintenance and repair of motor vehicles", exactly our trade: 49,597 enterprises turning over £37,462 million.

Treat 2024 as a figure that will move. The survey's own Quality and Methodology Information says national and regional figures for the current reference year are usually revised in the following year's release. ONS does not call them provisional, and the bulletin describes them as the final ABS results for 2024, but final there means the collection is closed, not that the numbers are fixed.

Per pound of turnover in 2024:

• 65.6p leaves as bought-in goods and services. Parts, oils, consumables, subcontract, rent, utilities, insurance and software all sit in this one line. Business rates do not. The ABS questionnaire tells you to exclude national non-domestic rates from purchases and report them in a separate box, and that box is not published in the Division 45 table at all.
• 35.2p is approximate gross value added. Close to turnover minus bought-in cost, but not the same thing, because ONS also picks up stock movements and other income. That is why 65.6 and 35.2 come to 100.8 rather than 100.
• 20.6p goes on employment costs. ONS counts gross pay, overtime, bonuses, holiday pay, employer's National Insurance, employer pension and redundancy.
• 14.5p is left. That comes from the unrounded ONS values, 35.166 minus 20.621. Subtract the rounded 35.2 and 20.6 instead and you get 14.6, which is rounding rather than a different answer.

Read that last one carefully. It is before business rates, depreciation, interest and tax, and ONS employment costs cover employees only, so a sole trader's drawings are not deducted anywhere in the sum. For a one-person garage, 14.5 percent means "margin plus my own wage", not take-home profit. It is a sample survey of roughly 73,000 businesses at a 69.90 percent response rate, covering businesses registered for VAT and/or PAYE.

Is 14.5 percent a good year or a bad one?

The same arithmetic on every ABS year from 2015 to 2024 gives 16.9, 17.0, 13.6, 14.5, 12.1, 11.3, 14.5, 15.0, 15.6 and 14.5 percent. A ten-year range of 11.3 to 17.0 percent, a mean of 14.5 percent, and 2024 landing exactly on it. So:

• Under 11.3 percent and you are behind the sector's worst year of the decade, 2020, which came in at 11.3.
• 11.3 to 14.5 percent and you are in the bottom half of a normal decade. This is where a lot of garages sit.
• 14.5 to 17.0 percent and you are at or above the ten-year mean, up to the best year the sector has managed, 17.0 in 2016.
• 17.0 to 20 percent and you are above anything this sector has managed in ten years. Check your cost capture before you celebrate, because the usual explanation is a cost that never reached the ledger.
• Over 20 percent and either you have found something the trade has not, or your figures are missing a cost.

Turnover up, margin flat, and no better off

This is usually a slogan. Here it is measurable.

Nominal SIC 45.2 turnover grew 57.7 percent between 2015 and 2024. That looks like a decade of growth. But the number of garages rose from 40,075 to 49,597, and CPI rose 33.9 percent over the same period (ONS series D7BT, annual averages). Put both in 2024 money and mean turnover per garage fell from £793,477 to £755,328, a real drop of 4.8 percent, while the margin ratio went from 16.9 percent to 14.5 percent.

The sector took in half as much again in cash and the average garage went backwards. If your turnover is up 30 percent since 2019 and your margin percentage has not moved, you have bought yourself more work at the same rate of pay.

Where you actually sit, because the average is a trap

Mean turnover per garage of £755,328 is true and useless. It is ABS 2024 turnover divided by the ABS 2024 enterprise count, and a handful of very large businesses drag it far above the typical unit. A different ONS dataset shows how far: "UK business: activity, size and location: 2025", released 24 September 2025, counts 75 businesses in SIC 4520 in its top turnover band of £50 million and over. That is a business count from the Inter-Departmental Business Register, a different universe and a different vintage from the ABS figure above, so use it for shape rather than for arithmetic against the ABS.

From Table 9 of that release, for SIC 4520:

Annual turnover	Garages	Share
Under £50k	3,000	6.0%
£50k to £99k	9,690	19.5%
£100k to £249k	18,425	37.0%
£250k to £499k	10,120	20.3%
£500k to £999k	5,025	10.1%
£1.0m to £1.9m	1,870	3.8%
£2.0m and over	1,610	3.2%

That last row is mine, not the ONS one. The table publishes four bands above £2.0m (£2.0m to £4.9m, £5.0m to £9.9m, £10m to £49.9m, and £50m and over), and I have added them together because at 1,000, 285, 250 and 75 garages they are too thin to read separately.

62.6 percent of UK garages turn over under £250,000, and the median one sits in the £100,000 to £249,000 band. Staffing tells the same story, from Table 4 of the same release: 74.7 percent have four employees or fewer. Two caveats the dataset gives itself: the counts are an IDBR snapshot taken 14 March 2025 while the turnover values relate to financial year 2023/24, and counts are rounded to base 5.

A quarter of garages also sit near or below the £90,000 VAT threshold in force since 1 April 2024, so their headline turnover is not comparable with a VAT-registered neighbour's.

Working out your own, from figures you already have

You need last year's turnover and last year's purchase ledger, not an accountant.

1. Turnover excluding VAT for the last twelve months.
2. Everything bought in. Parts, oils, tyres, consumables, subcontract work and MOTs you send out, plus rent, utilities, insurance, software and waste disposal. Leave business rates out, because ONS leaves them out. Put them in and you will understate your own gross margin by your whole rates bill and then understate the comparison in step 4 by the same amount.
3. Subtract 2 from 1, divide by turnover, compare with 35.2 percent.
4. Now take off wages, employer NI, pension and holiday pay, divide by turnover, compare with 14.5 percent. Both of those benchmarks sit before rates, so your figure has to as well.

If you cannot complete step 2 inside half an hour, that is the real finding, and it matters more than the answer. A garage that cannot see bought-in cost against sales in one place is guessing every time it quotes.

Why you cannot just look up the garage down the road

Because they almost certainly have not filed a profit and loss account. Small companies may currently choose not to send one to Companies House, and micro-entities file a balance sheet only. That changes, but less than the headlines suggest. Under the Economic Crime and Corporate Transparency Act 2023, from 1 April 2028 a profit and loss must be filed, though small companies and micro-entities will be able to opt out of publishing it on the public register, and GOV.UK says the mechanics of that opt-out are still to be confirmed. So it may still not be there to look up in 2029.

For now, and probably after 2028 too, published benchmarks are the only comparison you have, so quote the year and the release date when you use one. SMMT's aftermarket report Jobs, Growth, Mobility: What the Aftermarket Needs to Deliver, published September 2025, puts the aftermarket at £62.2 billion turnover, £17.1 billion GVA and some 339,000 jobs. Read the small print before you quote it. Those are 2023 figures, not 2025 ones; September 2025 is the publication date. They cover three SIC codes rather than one, 45.200 repair plus 45.310 parts wholesale and 45.320 parts retail, and SMMT says itself that the total may include an element of double counting as parts travel down the chain from supplier to distributor to workshop. The same report puts the 45.2 repair slice at £34.9 billion, 56 percent of the total, which is why £62.2 billion and the £37.5 billion for our own SIC code above are not in conflict.

Run SMMT's three codes for 2023 again on the 26 May 2026 ABS release and the turnover still comes to £62.2 billion, but the GVA now comes to £16.8 billion, because ONS revised 2023 when it published 2024. That £16.8 billion is my own arithmetic on the ABS table, not a figure ONS or SMMT prints.

The levers that actually move it

Labour rate. The largest, and the one most owners will not touch. Work out your real floor rather than copying the unit next door: what a UK garage should charge per hour.

Parts. No UK official source splits labour margin from parts margin. The published Annual Survey of Goods and Services tables, 2021 to 2024 edition, released 26 March 2026, carry motor trades as a single two-digit line: "repair and maintenance of motor vehicles and motorcycles". The survey does collect product detail underneath that, but the splits run by type of repair, ordinary, electrical, tyre and body, not labour against parts, so even the detail ONS collects would not answer this question. Meanwhile the ABS purchases variable bundles parts in with rent and utilities. All you get is a ceiling, since bought-in everything is 65.6 percent of turnover. For markup by part value, see what markup to put on parts.

Wages. The National Living Wage for 21 and over went from £11.44 in April 2024 to £12.71 in April 2026, an 11.1 percent rise in two years. Only the first of those upratings, April 2024's move from £10.42 to £11.44, falls inside the 2024 ABS year. April 2025's £12.21, April 2026's £12.71 and the April 2025 employer National Insurance change are all still to show up in the data. What the data does show is employment costs rising from 17.3 percent of sector turnover in 2023 to 20.6 percent in 2024, which is 28.5 percent more in cash on 7.7 percent more turnover. Treat the size of that jump with care, because 2024 is the year ONS is most likely to revise. If your own rate has not moved since 2024, your margin has.

Fixed-price work. The maximum MOT fee for a class 4 car is £54.85, set by DVSA and published on GOV.UK, and it has not moved in years while everything you buy has. Every discounted test dilutes blended margin by a calculable amount. That one is covered in what to charge for an MOT. Worth knowing if you test minibuses: the same GOV.UK table charges £64 for class 4 vehicles with 9 to 12 passenger seats, where the seat belt installation check applies.

A word on utilisation, honestly

The definitions used across the UK trade, as published by Motor Industry Management Systems Limited (Timepro), are: utilisation is productive time as a proportion of time attended, productivity is sold hours against hours attended, and efficiency is sold hours against the job time actually taken.

What nobody publishes is a benchmark. I went looking and found nothing from ONS, the IMI, the IGA or SMMT. The figures that circulate (85 to 95 percent efficiency, 60 to 75 percent utilisation) trace back to vendor blogs with no named survey, sample or period, and that includes the estimate in our own hourly rate post. Measure your own for a quarter and you will know more than any of them.

The bottom line

Whatever survives, Corporation Tax takes 19 percent on profits up to £50,000 and 25 percent above £250,000, with Marginal Relief between, unchanged for the years beginning 1 April 2025 and 1 April 2026.

Two numbers, once a year. Bought-in cost as a share of turnover, and what is left after wages. Compare with 35.2 and 14.5. If turnover is climbing and those two are flat, you are busier and no better off, and the fix is in your rate and your parts pricing, not more cars through the door.

Autera reports sales against parts cost and technician hours by month, so both ratios fall out of jobs you have already invoiced. See the reporting, or see how the workshop side fits together.