How to Calculate Sales Tax, VAT and GST
6 min read · Updated September 26, 2026 · by Thomas M, Registered Investment Adviser (South Carolina)
Sales tax, VAT and GST are all percentages added to a price, so the maths is identical: adding tax is a multiplication, and removing it is a division. The only real difference is whether the shelf price already includes the tax.
Adding tax
Total = net × (1 + rate). $100 at 8.25% sales tax: $108.25. £100 plus 20% VAT: £120.00.
Removing tax
Net = gross ÷ (1 + rate) — not gross × (1 − rate). £120 including 20% VAT is £100.00 net, so VAT is £20.00.
Handy shortcuts
| Rate | Tax inside a gross price |
|---|---|
| 20% (UK VAT) | 1/6 of the gross price |
| 10% (Australia GST) | 1/11 of the gross price |
| 15% (New Zealand GST) | 3/23 of the gross price |
Finding an unknown rate
Rate = (gross ÷ net − 1) × 100. $50.00 before tax and $54.25 at the till implies 8.5%.
Differences between the systems
US sales tax is added at the till and varies by state, county and city. VAT and GST are usually included in shelf prices, and businesses can generally reclaim the tax they pay on purchases. Rates and exemptions change — confirm with your tax authority. Calculators: sales tax, VAT, GST.
Practice questions
Test yourself, then tap to check. Answers are calculated by the tools linked below.
- A $64.90 receipt includes 9% sales tax. What was the price before tax?
Show answer
Price before tax (net): $59.54 · Sales tax included: $5.36
- Add 20% VAT to £450.
Show answer
Price including tax (gross): £540.00 · VAT to add: £90.00
- A$330 includes 10% GST. How much is the GST?
Show answer
Price before tax (net): A$300.00 · GST included: A$30.00
Frequently asked questions
How do I remove VAT from a price?
Divide by 1 plus the rate. At 20%, divide by 1.2.
How do I add sales tax?
Multiply the price by (1 + rate). For 8%, multiply by 1.08.
Why not subtract the percentage?
Because the tax was calculated on the net price, not on the gross total, so taking the percentage off the total removes too much.
Is the maths the same for VAT and GST?
Yes. Only the rates, exemptions and registration rules differ.
Try it yourself
Sales Tax CalculatorAdd sales tax to a price, take it out of a total, or find the tax rate from two prices.VAT CalculatorAdd VAT to a price, remove VAT from a total or find the VAT rate — with UK 20%, 5% and 0% presets.GST CalculatorAdd or remove GST on a price, with New Zealand 15%, Australia 10% and Canada’s 5% federal rate presets.
Invoice GeneratorCreate a clean invoice with line items, tax, discount and totals, then print it or save it as a PDF — free, no sign-up.Keep learning
How to Calculate Percentages7 min readPercentage Increase and Decrease7 min readHow to Write an Invoice6 min readReviewed by Thomas M, Registered Investment Adviser (South Carolina), who launched his own financial advisory firm in 2010. Spot a mistake? Tell us. See our editorial policy. Finance content is educational and not financial advice; see the disclaimer.