Sales taxes such as GST or VAT are usually a percentage of the taxable value. Confusion starts when a price is quoted including tax versus excluding tax.
Tax exclusive (add on top)
Tax amount = Net price × (Rate ÷ 100)
Gross price = Net + Tax
Tax inclusive (extract from total)
If the shelf price already includes tax at rate R%:
Net = Gross ÷ (1 + R/100)
Tax = Gross − Net
Business checklist
- Confirm whether your rate applies to the full invoice or only certain lines.
- Watch rounding rules on invoices (per line vs total).
- Keep net, tax, and gross columns separate in your books.
Use the GST Calculator or VAT Calculator to switch between exclusive and inclusive views before you print a quote.