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 £71 Plus VAT. Now if we use the standard VAT Rate(20%) then the Gross Amount would be £85.20 and the VAT amount would be £14.20.
| Initial Value | VAT Rate | VAT Amount | Gross Amount |
|---|---|---|---|
| £71 | 20% | £14.20 | £85.20 |
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20%
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Net Amount: £71.00
VAT: £14.20 (20.00% of net amount)
Gross Amount: £85.20
Difference (Gross - Net): £14.20
History 1 - Net Amount: £71.00, VAT: £14.20 (20.00% of net amount), Gross Amount: £85.20, Difference (Gross - Net): £14.20
71 Plus VAT
VAT Added Gross amount = Initial Price x (1 + VAT percentage)
Simply:- £85.20 = £71 x (1 + 20%) or £71 x (1 + 20/100)
Let me tell you another way to calculate £85.20
For example: Let’s say a product costs £71 before VAT.
- £71 (product cost) x 20% (VAT rate) = £14.20
- So the total price with VAT is: £71 (product cost) + £14.20 (VAT) = £85.20
