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Net & Gross Cost, VAT and Margin Calculator

Compare costs and selling prices before and after one entered VAT rate, with markup, margin and pre-VAT profit.

  • Formula & worked example
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Calculator inputs

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How to use this calculator

  1. Enter the known values in the units shown. Results update as you type.
  2. Where results are editable, change one to solve backwards. Lock a value to hold it fixed.
  3. Use the worked example to check the method. Reset restores the starting fields.

Use the result with context

Results are estimates for planning and education. Confirm rates, taxes, fees, and legal requirements with the relevant institution or a qualified professional before making a financial decision.

Formula and method

At an entered 20% VAT rate, a net cost of 80 has a gross cost of 96. A 25% markup gives net revenue of 100, gross revenue of 120 and pre-VAT profit of 20.

Gross cost = net cost × (1 + VAT); net price = net cost × (1 + markup); gross price = net price × (1 + VAT)

Worked example

Enter these known values and leave the other values blank.

Cost excluding VAT
80 USD
Entered common VAT rate
20 %
Markup on net cost
25 %
Cost including VAT
96 USD
Margin on net selling price
20 %
Selling price excluding VAT
100 USD
Selling price including VAT
120 USD
Net selling price less net cost
20 USD

Assumptions and limitations

  • The rate is supplied by you. This tool does not determine the applicable jurisdiction, taxable base, exemptions, recoverability or invoice-rounding rules.
  • The same VAT rate is applied to purchase cost and selling price. Different input/output rates and partially recoverable input tax need a separate model. Profit here excludes VAT and other expenses.
  • Margin must be below 100%. For an ordinary positive-price transaction use nonnegative costs and VAT. The calculator does not prepare a VAT return.

Common questions

Does this determine how much VAT I can reclaim?

No. It only multiplies the supplied prices by a rate. Recovery depends on the transaction and applicable rules.

Why is markup unchanged between net and gross amounts?

Both cost and selling price are multiplied by the same VAT factor in this model, so their ratio is unchanged.

References

The calculation equations, inverse formulas, units, and input rules were imported from this source. Bookify provides the interface and equation solver.

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