This is a simple guide on how to use the VAT calculator.
1. Enter amount.
2. Enter the VAT rate.
3. Choose whether you want to add or exclude VAT.
4. If you choose to add VAT it calculates the VAT charged on a net amount.
5. If you choose to exclude VAT it calculates the VAT included within a total amount.
6. Press calculate and the result will appear next to the calculate button.
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VAT is some sort of a consumption or sales tax and is the abbreviation of Value-Added Tax. Almost all countries in Europe charge VAT even those countries that are not member of the European Union for example such as Switzerland, Norway and Liechtenstein. What makes VAT even more complex is that tax rates differ from country to country. Germany for example has a tax rate of 19% but for some daily goods such as groceries, transportation, books and hotels a reduced rate of 7% is used. This is rather high compared to Switzerland, where VAT is 8% and the reduced rate is 3.8%. The country with the highest VAT rate is Finland with a staggering 24% and two reduced rates of 14% on food and restaurant services and 10% on transportation, books, pharmaceutical products and accommodation.
AT is added on all goods and services that are provided by a business that is VAT registered. VAT is also charged if a business imports goods and then sells these goods locally. Most of the time customers don’t even notice that they are paying VAT, as it is included in the sales price. If you buy a T-Shirt from H&M for EUR 9.99 VAT of 19% is included in the sales price of EUR 9.99.
However, businesses have an advantage over the ordinary end consumer as they can deduct VAT that the business themselves has paid to their suppliers. A restaurant owner, for example, buys fresh fruit and vegetables from a supplier and pays for it including VAT. The restaurant owner also has to pay VAT for the meals he sells to his customers. The restaurant owner deducts the VAT paid to his supplier so that amount of VAT he has to pay to the Government is reduced. This calculation is part of the VAT returns that have to be submitted to the tax authorities.
The VAT calculator on this website is an awesome tool to figure out how much VAT you have actually paid. If the sales price includes VAT simply click on the exclude VAT button and you will see the VAT amount within seconds. You can use the calculator with any tax rate.
If VAT is not included in the sales price you can use the VAT calculator to find the amount of VAT that has to be added to the sales price by clicking on the add VAT button. That’s enough about VAT. Have fun using the calculator!