After selecting the calculation type in the calculator below, enter the required information and press the calculate button.
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What is value added tax (VAT)?
It is a consumption tax that the buyer pays to the seller in the delivery of goods and services. Thus, the value added at each stage during the period from the first production to the final consumption of the goods is an indirect tax.
How is VAT calculated?
It is easily calculated using the following formulas.
To Calculate VAT Inclusive Price: (Net Price Before VAT) x [1 + (VAT Rate/100)]
According to this formula USD 1000 + 20% VAT can be calculated: 1000 x (1 + 20/100) = 1000 x (1 + 0.20) = 1000 x 1.20 = USD1200
To Calculate Net Price Before VAT: (VAT Inclusive Price) / [1 + (VAT Rate/100)]
According to this formula VAT Inclusive price of USD 1200 with a VAT rate of 20% can be calculated: 1200 / (1 + 20/100) = 1200 / (1 + 0.20) = 1200 / 1.20 = USD 1000
How to calculate net price before VAT?
If the tax amount is known, the tax base is calculated by the following formula.
Tax Base = VAT Amount / (VAT Rate/100)
According to this formula If VAT amount is USD 200 then net price before VAT can be calculated: 200 / (20/100) = 200 / (0.20) = USD 1000