VAT gets charged every time value is added as a product is made or a service is delivered. Now, let’s know what is the answer to £12 Plus VAT. Now if we use the standard VAT Rate(20%) then the Gross Amount would be £14.40 and the VAT amount would be £2.40.
Initial Value | VAT Rate | VAT Amount | Gross Amount |
---|---|---|---|
£12 | 20% | £2.40 | £14.40 |
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Net Amount: £12.00
VAT: £2.40 (20.00% of net amount)
Gross Amount: £14.40
Difference (Gross - Net): £2.40
History 1 - Net Amount: £12.00, VAT: £2.40 (20.00% of net amount), Gross Amount: £14.40, Difference (Gross - Net): £2.40
12 Plus VAT
VAT Added Gross amount = Initial Price x (1 + VAT percentage)
Simply:- £14.40 = £12 x (1 + 20%) or £12 x (1 + 20/100)
Let me tell you another way to calculate £14.40
For example: Let’s say a product costs £12 before VAT.
- £12 (product cost) x 20% (VAT rate) = £2.40
- So the total price with VAT is: £12 (product cost) + £2.40 (VAT) = £14.40