This may sound a bit stupid but what is the best way to work out profit and loss with lay bets so i can work out profit on turnover

Your turnover is really your risk.

So if you Lay a 20/1 (=21.0) chance for $1 - your risk and turnover are $20.

If you lay more than 1 contingency in a market (in proportion) your risk and turnover would start decreasing.

Lay and Back and it gets even weirder.

I don't know anyone who bother calculating POT for such complex scenarios.

I thought that too, but someone on another forum who was very persuasive in their arguement suggests your turnover is simply what bets you are holding as the bookmaker, not your potential risk.

So your example JFC would indicate $1 turnover only.

The easiest way would be winnings div. by payout

Yes I didn't agree with that when I read it. JFC's right. It's the profit over and above your total liability that really should be used not your hold. I do record "Profit on Total Liability" for my own use but 3.5% doesn't sound as good as 23.4% "Profit on Total Hold" ;)