Adding VAT to a net price
A $100 net price with 20% VAT becomes a $120 gross price, with $20 of tax.
VAT / sales tax calculator
This is an estimate for information only. Verify the exact rate and rules with your local tax authority or your invoice.
Result
Fill in the fields to see your result.
How it works
Adding tax multiplies the net price by one plus the tax rate. Removing tax works in the opposite direction: it divides the gross price by one plus the rate, since the gross price already has that multiplication baked in — dividing simply undoes it.
A common mistake is to remove tax by just subtracting the tax rate as a percentage of the gross price; that overstates the tax removed, because the rate applies to the net price, not the gross one.
Formulas used
Adding tax
Gross = Net × (1 + rate)
Removing tax
Net = Gross ÷ (1 + rate)
Worked examples
Extracting VAT from a receipt total
A $120 total that already includes 20% VAT breaks down to a $100 net price and $20 of tax.
Assumptions and limits
- A single flat tax rate applies to the whole amount.
- No tax-exempt portions or reduced rates apply within the amount.
Frequently asked questions
Why can't I just subtract 20% from the gross price to get the net price?
Because the 20% rate applies to the net price, not the gross one — subtracting 20% of the gross price removes too much tax. Dividing by 1.20 is the correct way to reverse it.
Is VAT the same as sales tax?
They work differently behind the scenes (VAT is collected at each stage of production, sales tax only at the final sale), but from a shopper's perspective, both add a percentage on top of the net price, so this calculator handles either.
What tax rate should I use?
The rate depends on your country, region and sometimes the product category — check the receipt, invoice or local tax authority for the rate that applies.
Can I use this for a whole invoice with multiple items?
Yes, if every item shares the same tax rate — apply it to the invoice subtotal. Mixed rates need to be calculated per line item instead.
Updated
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