Leveraged IRR Calculator
Calculate annual equity IRR after debt using equity contributions, distributions and net sale proceeds.
The annual discount rate that sets equity cash-flow NPV to zero is 15.51%.
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Get the model · €79 incl. VATHow the Leveraged IRR calculation works
Leveraged IRR solves NPV = 0 using equity cash flows after loan draws, interest and principal repayment.
Example calculation
Contribute €4.0m, receive €180k annually and €7.0m after repaying debt at exit in year five: equity IRR is 15.51%.
How professionals use the result
Use leveraged IRR to assess the equity return produced by a financing structure. Compare it with unleveraged IRR to understand the effect of debt.
Common mistakes
- Leaving principal repayment out of exit proceeds
- Counting loan proceeds as income twice
- Mixing monthly and annual timing
- Ignoring refinancing cash flows
Leveraged IRR Calculator FAQs
What does the Leveraged IRR calculator measure?
Calculate annual equity IRR after debt using equity contributions, distributions and net sale proceeds.
What formula does the Leveraged IRR calculator use?
Leveraged IRR solves NPV = 0 using equity cash flows after loan draws, interest and principal repayment.
Is the result suitable for a final investment decision?
Use it as a transparent screening calculation. Validate deal-specific tax, timing, financing and legal assumptions in a complete underwriting model before making a decision.
Do I need an account?
No. The calculator is free and runs in your browser. FormulaPlanet does not store your projects, inputs or results.
Is any input sent publicly?
No calculation is public by default. A shareable link is only created when you explicitly choose to copy one; that link contains the assumptions shown in its URL.
Why might my spreadsheet give a different answer?
Differences usually come from timing, compounding, sign conventions, fees or a different definition of the numerator or denominator. Match every period and definition before comparing.
What should I review alongside this result?
Use leveraged IRR to assess the equity return produced by a financing structure. Compare it with unleveraged IRR to understand the effect of debt.
Which mistakes are most common?
Leaving principal repayment out of exit proceeds; Counting loan proceeds as income twice; Mixing monthly and annual timing; Ignoring refinancing cash flows.