Question 1

How do I add VAT to a price?

Accepted Answer

Multiply the net price by (1 + VAT rate). For example, with 20% VAT: $100 x 1.20 = $120 gross price. The VAT amount is $20.

Question 2

How do I remove VAT from a price?

Accepted Answer

Divide the gross price by (1 + VAT rate). For example, with 20% VAT: $120 / 1.20 = $100 net price. The VAT amount is $20.

Question 3

What is the standard VAT rate?

Accepted Answer

VAT rates vary by country. Common rates: UK 20%, Germany 19%, France 20%, Sweden 25%, Australia 10% (GST), Canada 5% (GST). Some goods have reduced rates or exemptions.

Question 4

What is the difference between VAT and sales tax?

Accepted Answer

VAT is collected at every stage of production and credited against previous stages. Sales tax is only collected at the final point of sale to the consumer. The end price impact is similar.

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