How to calculate GST or VAT
To add GST or VAT, multiply the net price by the rate and add the result: £100 at 20% becomes £120. To remove it from a price that already includes tax, divide by 1 plus the rate: £120 ÷ 1.20 = £100. This calculator does both. Pick whether your amount is tax-exclusive or tax-inclusive, enter the rate, and it returns the tax and the other price.
GST (goods and services tax) and VAT (value added tax) are names for the same kind of tax: a percentage charged on the sale price of goods and services. The arithmetic doesn't depend on the name or the country, only on the rate.
The two formulas
Adding tax (amount is tax-exclusive):
- Tax = net price × rate ÷ 100
- Total = net price + tax
Extracting tax (amount is tax-inclusive):
- Net price = gross price ÷ (1 + rate ÷ 100)
- Tax = gross price − net price
The second formula is where most mistakes happen. Taking 20% of a VAT-inclusive £120 gives £24, but the real VAT is £20, because the 20% was charged on £100, not on £120. HMRC's VAT Guide (Notice 700) calls the share of tax inside a gross price the VAT fraction, worked out as rate ÷ (100 + rate). At 20% that is 20/120, which is one-sixth.
Worked examples
Adding 18% GST to 1,000:
- Choose Tax-Exclusive (add tax) and enter 1000 and 18.
- Tax = 1,000 × 18 ÷ 100 = 180.00.
- Total price = 1,000 + 180 = 1,180.00.
Removing 18% from 1,180:
- Choose Tax-Inclusive (extract tax) and enter 1180 and 18.
- Base price = 1,180 ÷ 1.18 = 1,000.00.
- Tax = 1,180 − 1,000 = 180.00.
A shop price with 20% VAT included: a £59.99 item has a base price of 59.99 ÷ 1.20 = £49.99 and VAT of £10.00. One-sixth of £59.99 is also £10.00, which is a quick way to check the answer in your head.
Tax fractions for common rates
The table shows how much of a tax-inclusive price is tax, for a range of rates. The UK standard rate of 20% and reduced rate of 5% are listed on GOV.UK's VAT rates page; the others are there for comparison.
| Rate | Tax share of the gross price | Tax on a gross price of 100 | Net price |
|---|---|---|---|
| 5% | 5/105 (1/21) | 4.76 | 95.24 |
| 10% | 10/110 (1/11) | 9.09 | 90.91 |
| 12% | 12/112 (3/28) | 10.71 | 89.29 |
| 15% | 15/115 (3/23) | 13.04 | 86.96 |
| 18% | 18/118 (9/59) | 15.25 | 84.75 |
| 20% | 20/120 (1/6) | 16.67 | 83.33 |
What this calculator does and doesn't do
- It applies one rate to one amount. If an invoice mixes items at different rates, calculate each group separately and add the results.
- It doesn't hold any country's rates. The rate box starts at 18% as a default; replace it with the rate that applies to your goods or services.
- It doesn't split tax into components. In India, for example, GST on a sale within a state is split between central and state GST, while a sale between states is charged as integrated GST. Enter the combined rate here and divide the tax yourself if you need the split. The GST Council publishes the current rate decisions.
- It rounds the tax and price to two decimal places. Results are always shown to the cent or penny, even for currencies that don't use them.
- The amount must be greater than zero and the rate can't be negative. A 0% rate is allowed and simply returns zero tax.
In the European Union, VAT rules are set out by member states within a common framework; the European Commission's VAT pages explain how it works across countries.
Related calculators
- Discount calculator: work out a sale price before adding tax.
- Profit margin calculator: check your margin on the net price, since output tax isn't income.
- Percentage calculator: for any other percent-of or percent-change question.
- Tax calculator: a flat-rate estimate for income tax.
Results are estimates. Tax rates and rules vary by country and product and change over time, so check the official tax authority or an accountant before relying on a figure for invoices or returns.
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