For VAT its common for tax to be included in the total, then the goal is to figure out what the before-tax price was.
Scenario 1: Your total includes tax
If the total is 100, and VAT is 20%, then:
- price + 20% = 100
- price * 1.2 = 100
- price = 100/1.2
- price = 83.33
- tax is 16.66
You can confirm with this 3rd party tax calculator: http://www.vatcalculator.co.uk/
For this scenario: enable "Inclusive" tax setting
Scenario 2: You want to add tax to your total
Alternatively, the app can add tax to the total. So if the total before tax is 100, and VAT is 20%, then:
- total-with-tax = 100 + 20%
- total-with-tax = 100 * 1.2
- total-with-tax = 120
- tax is 20
For this scenario: disable "Inclusive" tax setting