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CalcMax

VAT Calculator

Range: 0.01 – 1,000,000,000

Range: 0 – 100

Result

24.00

Tax

Amount before tax
120.00
Amount with tax
144.00
Tax, share of the total
16.67%

Value added tax is charged on almost everything sold in most of the world, and the one thing that trips people up is that the price on the label and the price in the accounts are two different numbers. This calculator moves between them in both directions. Add tax to a net amount and 120 plus 20% is 144, with 24 of tax in it. Strip the tax back out of 144 and the answer is 120 again, with the same 24 inside — and that symmetry only works because the second direction divides rather than subtracts. Taking 20% off 144 by subtraction gives 115.20, which is not the net amount; the correct division, 144 ÷ 1.20, gives 120. This is the single most common arithmetic error in VAT, and it runs in the direction people least expect, because the tax added on the way up and the tax removed on the way down are the same 24 either way, while the percentage that 24 represents is not 20% at all. Inside a price that includes 20% tax, the tax is 16.67% of the total. The panel prints that fraction as its last row, and for a seller who has to know how much of the money in the till belongs to the tax authority it is often the most useful of the four numbers. The table below sets out the rates in force in three places, because a calculator that only did arithmetic without saying whose rates it is doing arithmetic with would be leaving out the part that changes.

The rates in three places, and what each one applies to

CountryWhat the rate applies toRate
China (mainland)The standard rate, on the sale of goods, repair and replacement services and the leasing of tangible movable property, and on imports. It is the rate most invoices in mainland China carry, and it is charged on a tax-exclusive price with the tax shown separately on a special VAT invoice.13%
China (mainland)The lower rate, on transport, postal services, basic telecommunications, construction, the leasing and sale of real property, the transfer of land use rights, and a listed set of goods including agricultural produce, edible vegetable oil and salt, utilities such as water, heating, gas and electricity, and books, newspapers and periodicals. The list is part of the statute rather than a policy that can drift.9%
China (mainland)The rate on services and intangible assets that are not caught by the two rates above — modern services, financial services, lifestyle services and the sale of intangible assets other than land use rights. It is the rate that applies to most business-to-business service invoices, which is why the 6% band is the one most often seen in consulting and technology.6%
China (mainland)The levy rate under the simplified method of calculation, which the statute fixes at three percent. It is not a fourth rate in the same sense as the others: the simplified method computes the tax as sales multiplied by the levy rate, without the input tax credit that the general method allows, and it is the method small-scale taxpayers normally use.3%
United KingdomThe standard rate, on most goods and services. The United Kingdom also has a reduced rate of 5% for things such as domestic fuel and children's car seats and a zero rate for most food, books and children's clothing, and separately exempts items such as insurance and most education — the zero rate and the exemption are different things, since zero-rated input tax can usually be reclaimed and exempt input tax usually cannot.20%
GermanyThe standard rate under section 12(1) of the turnover tax act, on most goods and services. The reduced rate of 7% under section 12(2) applies to a listed set of supplies including most food, books, newspapers and local public transport, and the list is set out in the statute itself. German prices are normally displayed with the tax already inside them.19%

None of these rates is used by the calculator — it takes whatever rate you type — and the table is here because a page that does the arithmetic without saying whose rates exist would be leaving out the part that actually changes. Read the first column for the fact that there is no such thing as a VAT rate, only rates: three jurisdictions, six figures, and the spread is from 3% to 20% before any reduced band is considered. Read the middle column for why: every one of these rates is attached to a description of a transaction rather than to a number, and the description is what decides which rate applies. The last column is the figure you type into the field above; the middle one is the part a person has to answer. Two notes on how to read it. The Chinese rows are the statutory rates under the VAT law that took effect at the start of 2026, with the third of them being the levy rate under the simplified method rather than a fourth ordinary rate. And the two European rows are the standard rates only — both countries have reduced rates as well, and the UK also has a zero rate that is not the same as an exemption.

Formula

Tax added = net amount × rate | Tax removed = gross amount ÷ (1 + rate) − gross amount

baseAmount
The amount the tax is worked out from, and which amount that is depends on the direction you chose. Adding tax, it is the net price, the one without tax. Removing tax, it is the gross price, the one that already contains it. The field is named for the quantity rather than for either price because a name like net amount would be wrong in half the settings — and getting the two mixed up is the single most common VAT mistake, since adding tax to a gross price double-charges it.
vatRate
The rate to add or remove, as a percentage. It is a field rather than a fixed list because there is no single rate to fix: the standard rate is 20% in the United Kingdom, 19% in Germany and 13% for most goods in mainland China, and reduced rates exist everywhere — 5% and 0% in the United Kingdom, 7% in Germany, 9%, 6% and 3% in mainland China. The calculator does not decide which rate applies to your goods; that is a question of tax law, and the table below says what the rates are, not which one is yours.
mode
Which direction to go. Add tax takes a price that does not include it and puts the tax on top, which is how a price is quoted in the United States where sales tax is charged at the till. Remove tax takes a price that already includes it and takes the tax out, which is how prices are displayed across most of Europe and in mainland China, where the price on the shelf is the price you pay and the tax is inside it. Both are ordinary, and neither is a special case of the other.
taxAmount
The tax itself, and the panel's main figure because that is what the page is asked for. In both directions it is the difference between the two prices, and in the removal direction it is worked out by subtracting rather than by dividing a second time — which is why the pair of prices and the tax always add up exactly, with no rounding gap left behind for anyone to chase.
netAmount
The price without tax. When you added tax, this is what you typed; when you removed it, this is what the division produced. It is the figure that belongs in a VAT return as the taxable turnover, and the figure that a margin calculation has to use if the margin is to mean anything, since a gross revenue line over a net cost line mixes two different things.
grossAmount
The price with tax in it: what the customer actually pays and what lands in the till. When you removed tax, this is what you typed; when you added it, this is the sum. It is the number that reconciles against a bank statement, and the one that is not the taxable turnover.
vatFraction
The tax as a share of the gross price, and the row that surprises people. At a rate of 20% it is 16.67%, at 13% it is 11.50%, and at 5% it is 4.76% — never the rate itself, because the rate is a share of the net price and this figure is a share of a larger number. It is the fraction a business needs to know in order to set aside the right amount out of money already received, and it is the reason a rate of 20% is sometimes described as one sixth of a tax-inclusive price.

Use it when you have a price in one form and need it in the other: a supplier quotes a net figure and you need the total to pay, a shelf price includes the tax and you need the amount to claim back, an invoice arrived with only a gross total and the return asks for taxable turnover. The removal direction has a second use that is easy to miss — checking whether the tax on an invoice was worked out correctly, because dividing the gross total by one plus the rate is a sum anyone can redo, and a supplier who subtracted the percentage instead will be several percent out. And the last row answers a question the other three rows do not: how much of the money already in the till is not yours. That is the figure to set aside, and it is smaller than the rate, which is exactly why businesses that set aside the rate itself come up short.

Worked examples

  1. The default: 120 net, 20% added

    1. Tax: 120 × 20 ÷ 100 = 24
    2. Gross amount: 120 + 24 = 144
    3. Tax as a share of the gross: 24 ÷ 144 × 100 = 16.67%

    The straightforward direction, and the one where the last row is most worth reading: 20% of the net price is 16.67% of the price the customer pays, because the 24 is being measured against a total that already contains it. Both statements are true of the same 24.

  2. The same numbers backwards: 144 including 20%

    1. Net amount: 144 ÷ 1.20 = 120
    2. Tax: 144 − 120 = 24
    3. Tax as a share of the gross: 24 ÷ 144 × 100 = 16.67%

    All four figures are identical to the example above, which is the point: when the rate divides out cleanly the two directions are inverses of each other, and the page can be used from either end. The division is not decoration. Subtracting 20% of 144, which is 28.80, would give 115.20 and a tax of 28.80 — a net price that is too low, a tax that is too high, and an invoice that will not reconcile.

  3. A gross total that does not divide cleanly: 100 including 20%

    1. Net amount: 100 ÷ 1.20 = 83.333…, rounded to 83.33
    2. Tax: 100 − 83.33 = 16.67
    3. Tax as a share of the gross: 16.67 ÷ 100 × 100 = 16.67%

    Round numbers do not stay round in this direction, and that is normal rather than an error — a price that includes tax was not necessarily built from a round price that excluded it. Note that the tax is 16.67 rather than 16.66: it is the difference between the two rounded prices, so the three rows add up to exactly 100.00. Working it out as 100 minus a rounded division and then printing a tax that does not close is the kind of half-cent that shows up on a return.

  4. Mainland China, standard rate: 1,000 net at 13%

    1. Tax: 1,000 × 13 ÷ 100 = 130
    2. Gross amount: 1,000 + 130 = 1,130
    3. Tax as a share of the gross: 130 ÷ 1,130 × 100 = 11.50%

    The rate that applies to most goods sold in mainland China, and the arithmetic that shows why the last row is not the rate: a 13% tax is 11.50% of a tax-inclusive price. Run the same 1,130 backwards through the removal direction and the net comes back as 1,000 and the tax as 130, exactly — a clean pair, because 13% of 1,000 happens to be a whole number of cents.

  5. A rate that does not close: 99.99 net at 7.5%

    1. Tax: 99.99 × 7.5 ÷ 100 = 7.49925, rounded to 7.50
    2. Gross amount: 99.99 + 7.50 = 107.49
    3. Tax as a share of the gross: 7.50 ÷ 107.49 × 100 = 6.98%

    Enter 107.49 with the same rate and the removal direction gives back 99.99 and a tax of 7.50 — the pair closes, even though 7.49925 had to be rounded to get there. It closes because the tax is defined as the difference between the two prices rather than computed a second time, so the rounding lands in one place and stays there instead of drifting between the three rows.

  6. A zero rate: 120 at 0%

    1. Tax: 120 × 0 ÷ 100 = 0
    2. Gross amount: 120 + 0 = 120
    3. Tax as a share of the gross: 0 ÷ 120 × 100 = 0%

    Not a degenerate case to be filtered out but a real band: the United Kingdom charges 0% on most food, books and children's clothing, and mainland China exempts a list of goods and services. A zero rate is not the same thing as being outside the tax — a zero-rated seller can usually still reclaim the tax on its inputs, which is precisely the difference between zero-rated and exempt.

Limitations

This calculator does the arithmetic and nothing else. It does not know which rate applies to what you are selling, and that is not a detail it is leaving out for brevity: whether a delivery is a transport service at 9% or an ancillary part of a goods sale at 13% is a question about the nature of the transaction, answered by tax law and by the practice of the authority that administers it, and no arithmetic can decide it. Where a transaction contains more than one rate, the rule in mainland China is to account for the parts separately and, if you do not, to apply the highest rate — which means a single-rate calculator like this one can only be used once the rates have been separated. Nor does it model anything beyond the tax itself: no input tax credit, no registration threshold, no reverse charge on cross-border services, no place-of-supply rules, no exemption or partial exemption, no reduced rate for a specific category of goods, and no rounding rule imposed by an administration, some of which require the tax to be rounded down to the nearest unit of currency rather than to the nearest cent. Two things about the arithmetic are worth expecting rather than reporting. The first is the gap that appears when the rate does not divide cleanly: the removal direction can produce a net amount with more decimals than a price would ever have, and it is rounded here to the nearest cent, which means the tax on an invoice will occasionally differ by a cent from the tax on a return worked out in one step. The second is that the last row is a fraction of a gross amount and not a rate, so it will never equal the rate you entered — 20% becomes 16.67%, 13% becomes 11.50%, 5% becomes 4.76%. Finally, the rates in the table below are the ones in force at the time of writing in the places named. Rates change, usually in a budget, and reduced rates in particular are attached to lists of goods that get amended; check the current rate with the tax authority before invoicing on the strength of it.

Frequently asked questions

How do I remove VAT from a price that includes it?
Divide by one plus the rate, and then subtract to get the tax. At 20%, a gross price of 144 gives a net amount of 144 ÷ 1.20 = 120 and a tax of 24. Subtracting 20% of 144 instead gives 115.20, which is wrong — the 20% was charged on the smaller number, so taking 20% off the larger one takes off too much.
Why is the tax 16.67% of the price and not 20%?
Because the two percentages are measured against different totals. The rate of 20% is a share of the net price; the 16.67% is the same tax measured against the gross price, which is 20% larger. Both describe the same 24. The general rule is that a rate of r corresponds to r ÷ (1 + r) of the tax-inclusive price, so 20% becomes 16.67%, 13% becomes 11.50% and 5% becomes 4.76%.
What is the difference between adding and removing the tax?
Which direction the price you have is in. Adding starts from a price without tax, which is how prices are quoted in the United States where the tax goes on at the till. Removing starts from a price with tax already inside it, which is how prices are displayed in the United Kingdom, Germany and mainland China. The same pair of numbers can be read either way when the rate divides cleanly, and the calculator lets you work from whichever end you have.
What rate should I use?
The one the tax authority where you are selling says applies to what you are selling, and the calculator cannot tell you which that is. The table below gives the current rates in three places — 13%, 9%, 6% and a 3% levy rate in mainland China, 20%, 5% and 0% in the United Kingdom, 19% and 7% in Germany — but reduced rates are attached to lists of goods that get amended, so check before invoicing.
Is a zero rate the same as being exempt?
No, and the difference matters. A zero-rated sale is still a taxable sale charged at 0%, so the seller can normally reclaim the tax paid on its own inputs; an exempt sale is outside the scope of the tax, and the input tax is usually not recoverable. That is why some categories of goods are zero-rated rather than exempt. Either way the arithmetic on this page gives a tax of nothing and a gross price equal to the net one.
Why does the tax include a fraction of a cent?
Because a rate applied to a price rarely lands on a whole cent. 99.99 at 7.5% is 7.49925, which rounds to 7.50, and the gross price becomes 107.49. The tax is then defined as the difference between the two prices rather than computed again, so the three figures always add up exactly. Administrations differ on which way to round and on whether to round at all, so an invoice prepared to a different rule can differ by a cent.

References

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