VAT (Junior Cert Mathematics): Revision Notes
📚 Revision Notes
VAT
VAT stands for Value Added Tax. It's a tax added to the price of most things you buy. When you go to a shop and buy something, the price usually includes VAT. Sometimes, you might see a price without VAT, and then you have to add the VAT to find out how much you'll actually pay.
Two Situations with VAT
There are two main situations where you might need to calculate VAT:
1. VAT Excluded (VAT is not added yet):
- Imagine you see something you want to buy, and it says the price is , but this price doesn't include VAT. To find out how much you'll actually pay, you need to add VAT to this price.
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Example:
- Let's say the VAT rate is %. To calculate how much VAT to add:
- Find the VAT amount:
- Multiply the price by the VAT rate:
- Add the VAT to the original price:
- Now, add this VAT amount to the original price:
- So, you'll pay in total.
2. VAT Included (VAT is already added):
- Sometimes, you'll see a price that already includes VAT. For example, the price tag might say But what if you want to know what the price was before they added VAT?
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Example:
- Suppose the VAT rate is %.
- Understand that is already of the original price (% is the original price, and the extra % is the VAT).
- Find 1% of the original price:
- Divide the total price by to find out what % of the original price is:
- Find % (the original price before VAT):
- Multiply this amount by :
- So, the price before VAT was .
Simplified Steps to Remember:
- If VAT is excluded: Multiply the price by the VAT rate and then add it to the original price.
- If VAT is included: Divide the total price by + the VAT rate (e.g., for %) to find the original price.