Remove included tax
Formula
Pre-tax price = tax-inclusive total ÷ (1 + tax rate). Included tax = total − pre-tax price.
Reverse tax is useful for receipts, expense reports and reconciling a tax-inclusive total.
Do not multiply the total by the rate to remove tax: the tax percentage was originally applied to the smaller pre-tax amount.
Assumptions and limits
- Entered total already includes tax
- One combined tax rate applies
- No mixed taxable and exempt items
- Currency-neutral formula
Planning estimate, not tax advice
Tax law depends on facts this tool cannot collect. Do not use the result as the sole basis for filing, withholding or payment decisions.
Frequently asked questions
How do I remove 8.25% tax from $108.25?
Divide $108.25 by 1.0825. The pre-tax amount is $100 and the included tax is $8.25.
Is reverse tax the same as a salary gross-up?
Not necessarily. This page reverses transaction tax. Payroll gross-up uses income-tax and payroll-withholding rules.