Which price do you have?
Common rates:

The rate is whatever you type, not a figure this page assumes. Which rate applies to which goods and services depends on the rules in force, so check your invoice or your local guidance.

Net (before tax)1.000.000 ₫
Tax100.000 ₫
Gross (including tax)1.100.000 ₫

Extracting tax means dividing by (1 + rate), not multiplying by (1 − rate). At 10% the two differ by about 1% of the total.

How it works

VAT is added on top of a price, which gives two opposite questions: you have a net price and need to know what to charge, or you have a gross price and need to pull the tax back out for an invoice.

Adding is straightforward — multiply by the rate. Extracting is where the mistake lives. To recover the net price you must *divide* by (1 + rate), not *multiply* by (1 − rate).

At a 10% rate the two differ by about 1% of the total: small enough to survive a glance, large enough to make an invoice disagree with the books. On a gross of 1,100,000 the correct method gives 1,000,000 and the wrong one gives 990,000.

The rate here is whatever you type. Which rate applies to which goods and services is set by law and changes over time, so take it from your own invoice or from the guidance that applies to you.

Formula

Add: gross = net × (1 + rate) • Extract: net = gross ÷ (1 + rate)

The two are inverses. Add tax and then extract it correctly and you land back on exactly the original number — the quickest way to check you used the right direction.

Worked example

A gross of 1,100,000 at a 10% rate:

Net (correct)
1,100,000 ÷ 1.1 = 1,000,000
Tax
1,100,000 − 1,000,000 = 100,000
The wrong method
1,100,000 × 0.9 = 990,000
Difference
10,000 on one invoice

The wrong method always understates the net, so the tax line on the invoice is understated too.

Frequently asked questions

How do I remove VAT from a gross price?

Divide by (1 + rate). At 10%, divide by 1.1; at 8%, by 1.08. Do not multiply by 0.9 or 0.92 — that is a different calculation and it is wrong.

Why divide instead of subtracting the percentage?

Because the tax is a percentage of the net price, not of the gross. Subtracting takes the percentage from the wrong base.

What rate does this page assume?

None. The rate is a field you fill in. The preset buttons are typing shortcuts, not a claim about which rate applies to your goods.

Where do I find the right rate?

On your invoice or contract, or in the rules that apply to your category of goods or services. Rates differ by category and change over time.

Does it round?

Enough to remove floating-point noise and no further. Add tax and extract it again and you get the original number back exactly.

Can I handle several rates on one invoice?

This page does one rate at a time. For an invoice with several categories, do each one and add them up — which is also how a VAT invoice sets them out.

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Page
/en/vat-calculator
Tool
VAT Calculator
Language
English

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