VAT Calculator – How to Calculate VAT

Updated on June 4, 2022

Concerned about how much VAT you’ll be charged? Is the VAT included in the purchase, but I’m not sure what it is?

Using the online VAT calculator, you can figure out your total tax obligation, both with and without VAT. Just plug in the number and get your VAT computations done.

VAT CALCULATOR

 
 
 
 
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How Vat Calculator works

The taxable value and the VAT amount can be calculated using the VAT calculator. The price and the VAT rate are all you need to know to figure out the VAT. The VAT calculator allows you to determine whether or not a tax is exclusive or included.

Exclusive of VAT

If you’d like, you can put the whole cost of the goods or service, excluding VAT, in this field. Selecting exclusive of VAT results in VAT being calculated using the formula shown below.

Taxable Value = Rate of VAT÷100

Inclusive of VAT

In this case, the quantity or price is shown with VAT already included. In other words, it accounts for both the product’s price and the applicable VAT. The VAT amount can be calculated using the following formula when the price provided is inclusive of VAT:

VAT amount = Value inclusive of tax X tax rate ÷ (100 + tax rate)

Taxable Value/Price = Value inclusive of tax X 100 ÷ (100 + tax rate)

What is input Vat and output VAT?

The concept of input and output VAT is a basic part of the VAT system. Let’s look at some examples to have a better grasp on it.

Output VAT

Output Tax is the name given to the tax levied on the sale of products and services. As an example, A-One Traders made a sale of $1,000,000+5% tax on $1,000,000 of items. A-One Traders’ 5,000 tax is a production tax.

Input VAT

Input Tax is the name given to the tax paid on the acquisition of goods or services. A-One Traders, for example, paid Jumbo Distributors $50,000, plus 5% tax, for a shipment of goods. A-One Traders paid an Input Tax of $2,500.

How to calculate VAT payment?

A firm must pay VAT, however this does not mean that the entire amount of VAT collected on sales must be paid. For the purpose of arriving at or determining how to compute the VAT due to the government, the formula is provided below.

 VAT Payment = Output VAT – (minus) Input VAT

In this case, all you need to do is figure out the entire amount of output VAT and input VAT that you are entitled to claim back throughout the tax period. Apply the calculation above once you’ve figured out your output VAT and your input VAT.

If your output VAT exceeds your input VAT, you will owe VAT on the difference. If the output VAT is less than the input VAT, the amount refunded and so no VAT will be owed, resulting in a zero VAT liability.

The VAT payable can be generated automatically if you so desire. TallyPrime is the best way to automate your VAT reporting needs.. Complete business management software for UAE, Saudi Arabia, Bahrain, and Oman, TallyPrime provides VAT compliance.

For VAT compliance, TallyPrime provides the ability to generate precise invoices, automate calculations on a variety of supply types, and more. Get a free trial!

VAT Registration Criteria

The government of the United Arab Emirates has established three different tax brackets based on the company’s annual revenue. There are three slabs:

VAT registration is required for firms with a yearly revenue of more than AED 375,000.
VAT registration is optional for firms with yearly sales of between AED 187,500/- and AED 375,000/-.
VAT registration is not required for enterprises with yearly turnover of less than AED 187,500/-.

FAQ

How is the VAT calculation in UAE?

5 percent is the regular VAT rate in the United Arab Emirates (barring special cases like the profit margin scheme). Let’s say the cost price of the product or service is AED 100, for example. The value-added tax is now set at 5%. AED 5.00 would be the Input VAT if that is the case.

How do you add 5% VAT on a calculator?

The net sum must be multiplied by 1 plus the VAT percentage in order to arrive at the gross VAT amount.

How do you take VAT off a price?

To get rid of VAT, multiply the gross amount by -1 and round it down to the nearest whole number to get an estimate of the VAT gross amount.

What is VAT Calculation Formula to calculate VAT in UAE and Other Gulf Countries?

Value-added tax (VAT) is calculated as follows:

What is the VAT on 100?

Using the previous example, the input VAT would be AED 5.00 if the cost price of the products or services was AED 100.

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