Get quick and easy price calculations for any product or service, including VAT, with our online VAT Calculator. It is also a VAT reverse calculator, giving you the price without tax. It couldn’t be simpler to add or remove the VAT. We provide the exact formula for calculating cost, including VAT, as well as detailed calculations.
What is VAT?
VAT — that is, value-added tax sales tax on each additional value a good goes up the ladder from distribution to production. Basically, an amount is charged as a percentage of the final consumer retail price. This twists its tail really quite badly to scratch; every person or company bringing a little extra production or value to the product is compensated for their tax paid, ultimately being paid by the end consumer (often a legal entity). VAT is a significant source of government finances in most countries. Still, as a flat consumption tax payable by all people equally, some consider it unfair, especially low-income people, in arguing a bit about the outcome.
VAT (value-added tax) is applied with significant variance from country to country on the one hand and none at all on the other. VAT is mainly concentrated in Europe, especially the EU, but many different countries have accepted it under various names.
In many countries, VAT is usually imposed uniformly at a fixed rate of 15%-25%. However, in most situations, VAT is suspended on certain industries or even whole product and service classes; for example, education, books, basic food items, and transportation are some exceptions. In a few cases, other industries that are key for economic dynamics (such as tourism) may even be subject to preferential treatment to compensate for a symbolic loss of GDP.
Most countries have different VAT rates for various products and services. The standard VAT rate could be 20%, but books have a rate of 5%, and travel or accommodation services are probably 10%. That is why it is helpful to have a VAT calculator at your disposal.
VAT calculation formula
VAT Calculator formula for the normal price — what is so tricky in this simple VAT calculator formula — is just a percent increase over a price gross Amount (Price with VAT included). It is:
Price with VAT = Base Price * (100% + VAT%)
For example, to raise a gross price of 100 euros with a 15% tax, we have to do €100 * (100% + 15%) = €100 * 115% or the net amount with VATPrice including VAT 115. The mathematically equal is Multiplying 100 euros by 1,15.
Multiply 100 euros by 1.15 to get any amount of sales tax.
VAT = Base Price x VAT rate (%)
Let us take the case that the total is €20 and the tax rate is 10%. The VAT will be €20 x .10 = €2. Multiply €20 by 0.1, and this is. To get the total price, sum the VAT with the above amount: €20 + €2 = €22.
Subtracting the value of tax from a price that already has the tax factored in, you divide by (1 + tax). DIVIDE BY 1.2 to get the before-tax value, for example, with a 20% (0.2) tax rate. Our calculator allows you to calculate a price without VAT; select the “Price Without VAT” option—the price before tax.
VAT calculation examples
Example 1: Suppose that the price without VAT is €80 and the tax is 20%; adding VAT to a total amount is very easy to compute. Just plug the formula: €80 x (100 + 20)%. So your result is €80 x 120% = €80 *1.2 = €96.
Example 2: Sample calculation—the VAT for a product is 20%, and the gross amount is $50. VAT is easy to figure out.
VAT amount = $50 * 20% SALES SUMMARY FORMULA Formula VAT
Example 3: when the good or service for which you must pay is priced at €150 net and the rate of the Value Added Tax = 20%, then how much cash do you actually see when you spend money? Reverse the first equation with €150 / (100% + 20%) = €150/120% = €150/1.20 = €125 The pre-vat amount.
.VAT rates in Europe
Lookk at average VAT rates in Europe as a whole so that you know what to expect. Apologies for the long read, but here’s a table of European states categorized by their standard VAT rates for your pleasure.
This is from October 2024, and for the most part, VAT rates stay the same, but this may have changed by the time you reach the end of this. Also, keep in mind that some countries do certain exemptions with respect to goods and services like tourism, alcoholic beverages, and health care or education. So, it is better to double-check the current tax rate from a trusted source before purchasing anything. If not, you will either accidentally double(ing) the tax amount and, ultimately, the price or underestimate it.
Is it a VAT-inclusive price?
Before including VAT in a given price, ideally, verify that sales tax is not included [the first step]. Usually, merchants and service providers in very many countries, particularly in the European Union (EU), are required under law to display the VAT-inclusive price of any product offer (physical or digital). Others may be amenable to providing the price, but this will be the only one that lists a VAT-inclusive amount for all merchants. Usually, this detail is stated next to the price in some small print at the footer of every single page or in the terms and conditions. If you have any questions, ask at the time. In general, merchants are required by law to tell you how much this will be, which is included in the applicable VAT percentage.
But it gets even trickier when the provider and consumer are both VAT registered. This is because they share the price, as everybody will get VAT back, usually at the end of the month. They breathe in the total amount like hostage negotiators. But for bigger items, cash flow is an issue, so it’s good to keep the net amount (VAT included). That’s where our calculator comes in handy most of the time!