Sales Tax Calculator
Sales tax and VAT calculations have one common trap: the rate applies to the net price, not to the gross. Adding tax to a net figure means multiplying; removing tax from a gross figure means dividing, and using the wrong operation gives an answer that is close enough to look right but wrong by the tax amount.
Price including tax
$108.00
- Price before tax
- $100.00
- Tax amount
- $8.00
Values update as you type. This calculator covers the single scenario its formula assumes — see Common Mistakes for what it leaves out.
The formula this calculator uses
Gross = net x (1 + rate) ; Net = gross / (1 + rate)
- rate
- Sales tax or VAT rate as a decimal
- net
- Price before tax
- gross
- Price including tax
How to check the result by hand
- 1
Decide which figure you have
If you have the pre-tax price you are adding tax; if you have the total you are removing it. The two use different operations.
- 2
Convert the rate to a decimal
8% becomes 0.08 and 20% becomes 0.20.
- 3
Add one to the rate
This gives the multiplier, such as 1.08 for 8% or 1.20 for 20%.
- 4
Multiply or divide
Multiply a net price by the factor to get gross, or divide a gross price by the factor to get net.
- 5
Find the tax amount
The tax is the gross minus the net, which is 8 for a 108 gross at 8%, or 16.67 for a 100 net at 20%.
For worked examples, common mistakes and the limits of this formula, read the full How To Calculate Sales Tax page.