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 £120 Plus VAT. Now if we use the standard VAT Rate(20%) then the Gross Amount would be £144.00 and the VAT amount would be £24.00.
| Initial Value | VAT Rate | VAT Amount | Gross Amount |
|---|---|---|---|
| £120 | 20% | £24.00 | £144.00 |
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Net Amount: £120.00
VAT: £24.00 (20.00% of net amount)
Gross Amount: £144.00
Difference (Gross - Net): £24.00
History 1 - Net Amount: £120.00, VAT: £24.00 (20.00% of net amount), Gross Amount: £144.00, Difference (Gross - Net): £24.00
120 Plus VAT
VAT Added Gross amount = Initial Price x (1 + VAT percentage)
Simply:- £144.00 = £120 x (1 + 20%) or £120 x (1 + 20/100)
Let me tell you another way to calculate £144.00
For example: Let’s say a product costs £120 before VAT.
- £120 (product cost) x 20% (VAT rate) = £24.00
- So the total price with VAT is: £120 (product cost) + £24.00 (VAT) = £144.00
