Sales Tax Details
%
Calculation Result
Net: $0.00
Tax: $0.00
Net Amount$0.00
Tax Amount$0.00
How to Calculate Sales Tax
Understanding how sales tax is applied is crucial for budgeting and business accounting. Sales tax is generally calculated as a percentage of the purchase price of goods or services.
Exclusive vs. Inclusive Tax
Tax Exclusive
The tax is added to the base price. Formula: Price × (1 + Tax Rate).
Tax Inclusive
The price already includes tax. To find the net: Total Price / (1 + Tax Rate).
The Standard Tax Formula
To find the amount of tax paid on a single item, use the following simple arithmetic:
Tax Amount = Net Price × (Tax Rate / 100)
Frequently Asked Questions
What is sales tax?
Sales tax is a consumption tax imposed by the government on the sale of goods and services. It is collected by the retailer and passed on to the government.
How do I calculate tax from a total price?
To calculate the tax from a total price (tax-inclusive), divide the total amount by (1 + tax rate). For example, if the total is $115 and the rate is 15%, the net is $115 / 1.15 = $100. The tax is $15.