About this calculator
Enter the money invested today as a negative amount in year 0, then what you expect back in each later year. For cash flows on specific dates, use the XIRR calculator.
How to use it
- Enter the investment as a negative number in year 0.
- Enter the expected cash flows for each later year.
- Read the IRR.
The formula
- cash flow
- money in (negative) or out (positive) in each year
- t
- the year, 0 for today
Worked example
A ₹5 lakh project
- −₹5,00,000 today, then ₹1.2, 1.5, 1.8, 1.5 and 1 lakh over five years.
- IRR = 12.56% a year.
- At a 10% required return the project is worth doing, since its IRR is higher.
What the result means
Compare IRR with what you could earn elsewhere at similar risk. A project is attractive when its IRR is above that rate.
Assumptions
- Cash flows arrive at the end of each year.
Limitations
- Cash flows that change sign more than once can have more than one IRR.
- Tax and inflation are not separated.
Frequently asked questions
What is the difference between IRR and XIRR?
IRR assumes evenly spaced yearly cash flows; XIRR uses actual dates.
What is a good IRR?
One higher than your cost of money or the return on a safer alternative.
How are IRR and NPV related?
NPV is zero when the discount rate equals the IRR.
For information only. This calculator gives estimates based on the figures you enter and the assumptions listed above. It is not financial advice. Actual amounts depend on the lender’s or institution’s terms, fees, rounding and rate changes. Please confirm with them before you decide.
Last reviewed on 1 October 2026. Found a mistake? Tell us.