How to use the sales tax calculator
- Choose Add tax (you have the pre-tax price) or Remove tax (you have the total and want the net).
- Enter the price and the tax rate.
- See the net amount, the tax, and the gross total.
Adding vs removing tax
Adding tax is straightforward: gross = net × (1 + rate). Removing it is where people slip up — you can't just subtract the percentage. To strip tax from a gross price you divide: net = gross ÷ (1 + rate). For example, £120 including 20% VAT is £100 net and £20 tax — not £96 (which is what subtracting 20% would wrongly give you).
Benefits
- Adds tax to a net price or removes it from a gross price — the reverse case people get wrong.
- Works for any sales tax, VAT or GST rate.
- Shows net, tax and gross clearly for invoices and receipts.
- Instant and private.
Limitations to know
- You supply the rate — it does not look up local tax rates.
- It handles a single rate, not mixed-rate baskets.
- It does not handle tax exemptions or special product rules.
Common mistakes to avoid
- Subtracting the percentage to remove tax — you must divide by (1 + rate).
- Using the wrong rate for the product category or region.
- Rounding at each line instead of on the total, which can shift the final figure by a cent.
Alternatives
To apply a discount use the Discount Calculator; to build the document use the Invoice Generator.
Last updated: August 2026 · Reviewed by the AI Toolbox editorial team.
Frequently asked questions
Why can't I just subtract the percentage?
Because the tax was calculated on the smaller net figure, not the gross. You must divide by (1 + rate).
Does it work for VAT and GST?
Yes — the maths is identical for any percentage-based sales tax, VAT or GST. Just enter your rate.
Does it know my local tax rate?
No — rates vary by country, state and product, so you enter the rate that applies to you.
Is my data saved?
No — it's calculated in your browser.