## How Do I Calculate VAT Backwards?

Whether you're trying to get back to the pre-tax price of an item as part of a word problem or calculating the sales tax backwards from a receipt in your hand, the math is the same. You'll need to know the total amount paid and either the amount of tax paid, which will let you calculate the tax rate, or the tax rate, in which case you can calculate the amount of tax paid. This method assumes you know the total amount paid and the amount of tax paid, and you need to figure out the percentage tax rate that was assessed. Subtract the amount of tax you paid from the total, post-tax price of the item. This gives you the pre-tax price of the item. Divide the amount of tax you paid by the pre-tax price of the books. The result is the percentage tax rate you paid, expressed as a decimal. To continue the example, you have:. Multiply the tax rate by to convert it to a percentage. So if your tax rate is. This method assumes that you know the total post-tax price for the item and the tax rate that was assessed, so you need to calculate backward to find out how much money actually went toward the sales tax. Add percent to the sales tax rate. The percent represents the whole, entire pre-tax price of the item in question; when you add it to the tax rate, you get a total percentage that represents the pre-tax price plus the tax. So if the sales tax in your area is 8 percent, you have:. Divide the "tax paid" rate you just calculated by to convert it from a percentage into a decimal. So if you had percent as the tax paid rate, that becomes:. Divide the post-tax price of your item by the "tax paid" decimal you just calculated. Now that you know how much the stuffed animal cost before and after taxes, you can subtract the pre-tax price from the post-tax price to find out how much tax you actually paid:. Lisa Maloney is a travel and outdoors writer based in Anchorage, Alaska. She's written four outdoors and travel guidebooks, including the award-winning "Moon Alaska," and regularly contributes to local and national publications. She also has a background in personal training, with more than 6, hours of hands-on experience. Share It. About the Author.