FCCR calculator
The fixed charge coverage ratio (FCCR) shows whether a business makes enough cash to pay its fixed charges. In its common form it is the cash left after capex, taxes and distributions, divided by principal, interest and lease payments.
Free for lenders. Amounts in pounds, and nothing leaves your browser.
For the year, before interest, tax and depreciation
Equipment and works paid for from cash
Tax actually paid in the year
Dividends and owner withdrawals
Loan repayments due in the year
Interest due in the year
Rent and lease payments due in the year
Enter EBITDA and at least one fixed charge, or fill in the example, to see the ratio.
This is the common form of the ratio. Your facility agreement may define it in another way.
The ratio is arithmetic. What the numbers behind it really are, taken from the accounts, the tax returns and the bank statements, is where Klarefi comes in. Whether the ratio is good enough stays your call.
Build your loan applicationThe formula, and how it differs from DSCR.
The common lender covenant form is:
(EBITDA − unfinanced capex − cash taxes − distributions) / (scheduled principal + interest + lease payments)
Lenders define the FCCR in the facility agreement, and the definitions differ. Use the wording in your own agreement when it differs from this form.
The DSCR compares cash with loan payments only. The FCCR also counts lease payments, and it takes capex, taxes and distributions off the cash first. So the FCCR is lower than the DSCR on the same figures. To test a new loan and find the largest loan that meets your target, use the DSCR calculator.
How the ratio is worked out.
Find the cash available
Start with EBITDA for the year. Take away the capex paid from cash, the taxes paid and the money paid out to the owners.
Add up the fixed charges
Add the scheduled principal, the interest and the lease payments due in the same year.
Divide the one by the other
A ratio of 1.00 means the cash just covers the charges. Above 1.00 leaves a margin. Below 1.00 the charges are more than the cash.
What the ratio leaves out.
- Whether the EBITDA is the real number, or still holds one-off income.
- Leases and loans that are not on the list the applicant gave you.
- Whether the tax and capex figures are what was paid or only a plan.
- Which items your facility agreement counts, since definitions differ.
Those take the accounts, the tax returns and the bank statements read together. That is the work Klarefi does during the application, with every number linked to the line it came from. Your credit team decides.
Questions about the FCCR.
What is a good FCCR?
A ratio above 1.00 means the cash covers the fixed charges. Lenders want a margin above that and set their own minimum. The minimum is usually written into the facility agreement as a covenant.
What is the difference between FCCR and DSCR?
The DSCR compares cash with loan payments. The FCCR also counts lease payments, and it takes capex, taxes and distributions off the cash first. The FCCR is the stricter test.
Which definition of FCCR should I use?
Use the one in the facility agreement. This calculator shows the common form, but lenders define the ratio in their own way and the definitions differ.
Related.
- DSCR calculator
Check whether the cash a business makes covers the payments on a new loan.
- Klarefi for independent business lenders
How Klarefi completes the application file before it reaches your credit team.
- Business loan origination software
What the different kinds of lending software do, and where intake fits.
A case file ready for your credit team.
The form says turnover was 2.4 million. The annual accounts say 2.18 million. Klarefi reads the application, the accounts and the bank statements together, asks the applicant about the difference while they are still applying, and adds the answer to the file.
net turnover for the year of €2,184,300 from continuing operations
Free to start. Data stored in the EU by default.
Send applicants one link
They upload the accounts, the bank statements and the rest of your list, from any device.
Klarefi checks each application
It reads every document, compares the numbers, and asks the applicant in a chat for anything missing or unclear.
Your credit team reviews one file
Every number links to the line it came from. Anything still open stays visible for review.