Quickly switch between price-with-VAT and price-without-VAT, at any rate and in any currency. Useful for quoting, pricing, and understanding the breakdown of an invoice.
VAT is a consumption tax the seller collects on behalf of the tax authority and remits each month. It is not business income. This calculator solves the VAT math — net to gross, or gross to net — at any rate you declare (16% Mexico, 21% Spain, 19% Colombia, 18% Peru, etc.). It's illustrative: for actual filing you need certified fiscal software and an accountant.
Financial disclaimerIndicative result — not professional financial advice. Consult a specialist before making investment or credit decisions.
Two modes: add VAT to a net amount (price without tax → public price) and remove VAT from a gross amount (public price → what you keep as net). It shows the VAT amount separately so you can see what percentage of the total goes to the tax authority.
Who it's for
For anyone who quotes, invoices, or buys with VAT: SMBs, freelancers, retailers, service providers, e-commerce. To understand what portion of a public price is tax and what portion is seller revenue. To evaluate post-VAT margins before setting the public price.
When to use it
When quoting to understand the total price the customer will see. When receiving an invoice to confirm the applied VAT is correct. When setting public prices working back from the net you need. When comparing supplier costs that quote some with VAT and others without — the calculator normalizes for a clean comparison.
When NOT to use it
Don't use it to issue invoices, file returns, or decide your tax regime. It does not replace SAT, AEAT, DIAN, SUNAT, or your accountant. Reduced rates (basic foods, medicines, exports) and exemptions have country- and product-specific rules this calculator does not apply automatically — you declare the rate.
What data it needs
Amount
The amount to convert. It can be the net price (without VAT) or the gross price (with VAT), depending on the mode you choose.
VAT rate
The applicable percentage. Default is 16% (Mexico). You can adjust it to 21% (Spain standard), 19% (Colombia), 18% (Peru), or any other rate in your jurisdiction.
Mode (add / remove)
Add VAT converts net to gross. Remove VAT converts gross to net. The calculator shows both results and the exact tax amount.
Formula
Add VAT: Gross = Net × (1 + rate). Remove VAT: Net = Gross / (1 + rate). VAT amount = Gross − Net. With a 16% rate (Mexico), $1,000 without VAT equals $1,160 with VAT, and $1,160 with VAT equals $1,000 without VAT.
How to interpret the result
The VAT amount is NOT business income: you remit it in the monthly filing (or whichever period applies). Setting it aside in a separate account avoids spending it and facing the payment without liquidity. If the customer can deduct VAT, their effective cost is the net; if they can't deduct it, they pay the gross. That nuance matters when setting price.
How this calculator was reviewed
What you'll see, what it prevents, and where you shouldn't trust it
Every flagship calculator ships with the same editorial structure: two hypothetical worked examples with numbers, the errors it helps you avoid, the model's declared limitations, and a visible financial disclaimer. The review is signed and dated.
Hypothetical case·Case A
A freelancer who quotes $12,000 plus VAT and understands exactly what lands in the bank
A freelancer in Mexico quotes a $12,000 MXN project before VAT at 16%. The calculator shows: total price $13,920; passed-through VAT $1,920. After VAT withholding 10.667% (corporate client) and income tax 10%, net income to the freelancer is $9,920 MXN. The calculator helps anticipate the gap between 'what I charge' and 'what hits my account', but the actual filing is done by the accountant under the freelancer's tax regime.
Illustrative figures. This example does not represent a real company or a financial recommendation.
Hypothetical case·Case B
An online store that sets the public price working back from the net amount it needs
An online store wants to receive $245 MXN net per t-shirt to sustain its target margin. With 16% VAT, the public price is $284.20 MXN. If the marketplace charges 10% commission on the public price (plus VAT on the commission), the effective amount the store receives drops to $211.32. The calculator solves the VAT math; the price adjustment to keep margin lives in the pricing simulator.
Illustrative figures. This example does not represent a real company or a financial recommendation.
Common mistakes it helps you avoid
Things a team or decision-maker might assume that this calculator forces you to verify before closing the math.
Confusing 'price with VAT' with 'price without VAT': when a supplier quotes you $1,160 'VAT included', the net price is $1,000 — the difference matters for your bookkeeping and your margin math.
Forgetting reduced or zero rates: basic foods, medicines, and exports have different rates. The calculator uses the rate you declare; if it changes by product, the result changes.
Treating VAT as income: passed-through VAT is NOT your money, it's the tax authority's. Setting it aside in a separate account avoids spending it and facing the monthly payment without liquidity.
Mixing tax regime with price calculation: the calculator tells you how much VAT applies to an amount. It does NOT tell you whether you must charge VAT, whether you can deduct it, or how to file.
Model limitations
What the calculator does not do, and where you need a professional or a specialized tool.
It is not an invoicing tool. It does not generate CFDI, Spanish electronic invoices, or equivalents; it only calculates illustrative VAT.
Does not query official rates in real time or jurisdiction-specific rules (state, regional, exempt products). You declare the rate.
Does not include withholdings (income tax, withheld VAT) that depend on the issuer's and receiver's tax regime. For those calculations consult your accountant.
Does not replace the formal filing with SAT, AEAT, DIAN, SUNAT, or local tax authority. It's an arithmetic shortcut, not a tax tool.
When NOT to use this calculator
Do not use this calculator to file returns, issue invoices, or decide your tax regime. It is a VAT arithmetic calculator, not a tax tool. For real tax filing you need certified fiscal software (Contpaqi, A3, Holded, FacturaDirecta, etc.) and a licensed accountant who knows your full tax situation. Simúlalo is not affiliated with, sponsored by, or endorsed by SAT, AEAT, CONDUSEF, CNBV, or any tax authority mentioned.
Financial, tax, accounting and legal notice
The result is an informative estimate based on the data you enter. It does not constitute financial, tax, accounting, or legal advice. For decisions that affect taxes, financing, or wealth, validate the numbers with a certified professional in your jurisdiction.
Editorial review
Reviewed by the Simúlalo editorial team
This simulator was reviewed by the people listed below before being published. The review covers the declared formula, the model's assumptions, the explicit limitations, and the absence of unsupported financial claims.
They are part of the Simúlalo editorial team, focused on building financial tools that are clear, educational, and easy to interpret.
Last updated: ·We update this page when the methodology, sources used, or simulator structure change.
This tool uses standard financial formulas and user-supplied data. To explain concepts like rates, credit, risk, or cash flow we consult public and official sources (Banxico, SAT, CONDUSEF, CNBV, Banco de España, IFRS, BIS, among others). Simúlalo is not affiliated with, sponsored by, or endorsed by these institutions.
Frequently asked questions — VAT
1Which rate should I use?
The one applicable to your jurisdiction and product. Mexico standard 16% (and 0% on northern/southern border in some cases). Spain standard 21%, reduced 10% (food, transport), super-reduced 4% (books, medicines). Colombia 19%. Peru 18%. Argentina 21%. If you sell to another country, exports may be exempt. Verify with your accountant before applying reduced rates.
2Does this calculator generate an electronic invoice?
No. It only calculates the VAT math. To issue CFDI in Mexico, electronic invoices in Spain, or local equivalents you need software certified by the corresponding tax authority.
3How do I handle withheld VAT?
VAT withholding depends on the issuer's and customer's tax regime (individual vs corporation, type of service, amount). In Mexico, professional services typically withhold 10.667%. The calculator does not apply withholdings automatically; consult your accountant before invoicing.
4Is the VAT collected business income?
No. Passed-through VAT is collected on behalf of the tax authority. Business profit is calculated on the net amount (without VAT). Mixing collected VAT with operating cash flow is one of the errors that breaks SMB liquidity during growth.
5Does the calculator work in different currencies?
Yes. Currency is independent of the VAT rate. Results respect your locale formatting (thousand separators, decimals). To apply the correct VAT in an international transaction, first verify which jurisdiction taxes the operation.
Strip VAT out of a price or add it on top — and see how much goes to the tax office vs. what you actually keep.
Results
Base
MXN 1,000
VAT
MXN 160
Total
MXN 1,160
Healthy
How much actually stays after VAT?
Net keep86.2%VAT remitted$160
Diagnosis
You're operating clean: you invoice the 16% VAT separately. The customer pays $1,160, you remit $160 to tax and keep $1,000 as base. The tax flows through your account without eating margin.
Threshold
Rates ≥ 13% (MX 16, CO 19, CL 19, AR 21, ES 21) are too high to absorb without margin damage. Your rate is 16% — pass that 13.8% of the price through to tax, not from your own pocket.
Action
This week: park the $160 of VAT in a separate account on the day you collect. The temptation is to use it as working capital; when the tax payment date arrives, it's gone. The monthly filing doesn't forgive.
Risk if you do nothing
Collected VAT isn't yours, it's the tax authority's. If you spend it on operations, the monthly payment date arrives and you have nothing to pay with. Penalty interest of ~1.47% monthly plus inflation adjustment is the cost of decapitalizing yourself with someone else's money.