VAT Calculator

Updated on June 28, 2022

Worried about the amount of VAT that may be charged? Is the VAT included in the purchase, but I’m not sure how much it is?

It is possible to compute VAT in both its exclusion and its inclusion using an online VAT calculator. Simply enter the amount to obtain an accurate VAT computation.

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Compliance solutions right from invoicing to filing returns are just a click away

How Vat Calculator works

Taxable value and tax amount can be calculated using the VAT calculator. The price and the VAT rate are all you need to know to compute VAT. Using the VAT calculator, you can figure out both the exempted and the taxable portion of VAT.

Exclusive of VAT

It’s important to note that the price you input here does not include any applicable sales taxes, so what you see is what you get. When you choose to exclude VAT, the following formula will be used to calculate the applicable VAT rate.

Taxable Value = Rate of VAT÷100

Inclusive of VAT

In this case, the quantity or price is shown with VAT already included. Product cost and VAT amount are included in this figure. The following formula can be used to determine the VAT amount when the price offered includes the VAT.

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

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

What is input Vat and output VAT?

Input VAT and output VAT are essential concepts in the VAT system. Let’s have a look at some instances.

Output VAT

Output Tax is the name given to the tax levied just on sale of products and services. As an example, A-One Traders made a sale of $1,000,000 in products and services, which included a 5% tax rate. A-One Traders collects a tax of 5,000 as an output vat.

Input VAT

Input Tax is the name given to the tax paid on the acquisition of goods or services. A-One Traders, for instance, bought items from Jumbo Distributors valued $50,000 plus 5% tax. A-One Traders pay an Input Tax of 2,500.

How to calculate VAT payment?

Taxpayers are not obligated to fork over the whole amount of VAT received from sales when firms are registered for VAT. The formula for calculating the VAT due to the government may be found below.

VAT Payment = Output VAT – (minus) Input VAT

Simply add up all of the output VAT you’ve collected throughout the tax period and the input VAT you’re entitled to deduct. 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 be responsible for the difference in VAT. If the output VAT is lower than the input VAT, the difference is repaid, and no VAT is due.

Automating VAT computations and creating a tax bill is an option. TallyPrime is the VAT automation solution you’ve been looking for. Complete company management software for UAE, Saudi Arabia, Bahrain, and Oman, TallyPrime provides VAT compliance.

For VAT compliance, TallyPrime provides the ability to create precise invoices, automate calculations on a variety of supply types, and more. You may get a free trial by contacting us!

VAT Registration Criteria

The UAE government has decided on three distinct slabs based on the annual revenue generated. As an example, consider these three slats:

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 between AED 187,500/- and AED 375,000/-.
Businesses having a yearly revenue of less than AED 187,500/- are exempt from the requirement to register for VAT.

FAQ

How is the VAT calculation in UAE?

The normal VAT rate in the United Arab Emirates is 5% of the invoice amount (barring special cases like the profit margin scheme). For example, if the cost price of the products or services is AED 100. Currently, the VAT rate is 5. That’s 100 multiplied by 5%, which comes out to AED 5 as the input VAT.