How to calculate VAT | Add or Exclude VAT on Certain Amount 💶

VAT Calculation: Add or Exclude VAT on a Certain Amount.

How to calculate VAT in simple wording. In this article, I use PHP to perform VAT calculations. How to calculate VAT in PHP. I also provide VAT_Trait.php below so, you can use that trait in any PHP project or frameworks like Laravel, Laminas, Zend or CakePHP, etc.

Using the above example you can calculate VAT on x-amount. Add VAT on x-amount or Exclude VAT on x-amount. And also calculate the added or excluded VAT value on the amount.

Requirements

you need VAT Percentage. current VAT percentage is 20% means In this article I’ll calculate VAT on X-Amount using 20% VAT.

PHP 8.0, column decimal(12, 2)

Let’s Understand first

20% VAT add on 100 amount is = 120

20% VAT excluded on 100 amount is = 83.33

In-Depth

Calculation

<?php
const VAT_PERCENTAGE = 20; // 20%
class Cart
{
    public function calcAddVatToAmount($vat_percentage, $amount): float|int
    {
        // $amount * (1 + $vat_percentage / 100)
        return round($amount * (1 + $vat_percentage / 100), 2); // simple roundof
        //or simple
        /*
         * calculate 20% tax on x-amount
         * ((20 % 100) * x-amount) + x-amount
         * */
    }
    $cart = new Cart();
    echo $cart->calcAddVatToAmount(VAT_PERCENTAGE, 9);
    // Gross amount: 10.80
    public function calcExcludeVatFromAmount($vat_percentage, $amount): float|int
    {
        // $amount - ($amount - $amount / (1 + $vat_percentage / 100)
        return round($amount - ($amount - $amount / (1 + $vat_percentage / 100)), 2);
    }
    $cart = new Cart();
    echo $cart->calcExcludeVatFromAmount(VAT_PERCENTAGE, 9);
    // Net amount: 7.50
    // if you want to check how much VAT is added on x-amount
    public function calcVatAddedValue($vat_percentage, $amount): float
    {
        $amount_including_vat = $this->calcAddVatToAmount($vat_percentage, $amount);
        // $amount_including_vat - $amount
        return round($amount_including_vat - $amount, 2); // simple roundof
    }
    $cart = new Cart();
    echo $cart->calcVatAddedValue(VAT_PERCENTAGE, 9);
    // VAT added: 1.80
    // How much VAT value is excluded then
    public function calcVatExcludedValue($vat_percentage, $amount): float|int
    {
        // $amount - $amount / (1 + $vat_percentage / 100)
        return round($amount - $amount / (1 + $vat_percentage / 100), 2);
    }
    $cart = new Cart();
    echo $cart->calcVatExcludedValue(VAT_PERCENTAGE, 9);
    // VAT excluded: 1.50
}

Step-by-step VAT functions

Let’s destructure Cart Class.

Calculate VAT Add on amount

<?php
const VAT_PERCENTAGE = 20; // 20%
class Cart
{
    public function calcAddVatToAmount($vat_percentage, $amount): float|int
    {
        return round($amount * (1 + $vat_percentage / 100), 2);
    }
}
$cart = new Cart();
echo $cart->calcAddVatToAmount(VAT_PERCENTAGE, 9);
// Gross amount: 10.80

Calculate VAT Exclude on amount

<?php
const VAT_PERCENTAGE = 20; // 20%
class Cart
{
    public function calcExcludeVatFromAmount($vat_percentage, $amount): float|int
    {
        return round($amount - ($amount - $amount / (1 + $vat_percentage / 100)), 2);
    }
}
$cart = new Cart();
echo $cart->calcExcludeVatFromAmount(VAT_PERCENTAGE, 9);
// Net amount: 7.50

Calculate how must VAT added to the amount

<?php
const VAT_PERCENTAGE = 20; // 20%
class Cart
{
    public function calcAddVatToAmount($vat_percentage, $amount): float|int
    {
        return round($amount * (1 + $vat_percentage / 100), 2);
    }
    public function calcVatAddedValue($vat_percentage, $amount): float
    {
        $amount_including_vat = $this->calcAddVatToAmount($vat_percentage, $amount);
        return round($amount_including_vat - $amount, 2);
    }
}
$cart = new Cart();
echo $cart->calcVatAddedValue(VAT_PERCENTAGE, 9);
// VAT added: 1.80

Calculate how must VAT excluded from the amount

<?php
const VAT_PERCENTAGE = 20; // 20%
class Cart
{
    public function calcVatExcludedValue($vat_percentage, $amount): float|int
    {
        return round($amount - $amount / (1 + $vat_percentage / 100), 2);
    }
}
$cart = new Cart();
echo $cart->calcVatExcludedValue(VAT_PERCENTAGE, 9);
// VAT excluded: 1.50

VAT Trait for PHP projects e.g Laravel, Laminas, etc

You can use the below trait in any PHP project.

Download file Github Gist

Embedded File

Raw File

<?php
namespace App\Helpers;
class VAT_Helper
{
    const VAT_PERCENTAGE = 20;
}
// -------------------------------------
?>
<?php
namespace App\Traits;
use App\Helpers\VAT_Helper;
trait VAT_Trait
{
    public function calcAddVatToAmount(float $amount, int $vat_percentage = VAT_Helper::VAT_PERCENTAGE): float|int
    {
        return round($amount * (1 + $vat_percentage / 100), 2);
        // e.g Gross amount: 10.80
    }
    public function calcVatAddedValue(float $amount, int $vat_percentage = VAT_Helper::VAT_PERCENTAGE): float
    {
        $amount_including_vat = $this->calcAddVatToAmount($amount, $vat_percentage);
        return round($amount_including_vat - $amount, 2);
        // e.g VAT added: 1.80
    }
    public function calcExcludeVatFromAmount(float $amount, int $vat_percentage = VAT_Helper::VAT_PERCENTAGE): float|int
    {
        return round($amount - $amount / (1 + $vat_percentage / 100), 2);
        // e.g Net amount: 7.50
    }
    public function calcVatExcludedValue(float $amount, int $vat_percentage = VAT_Helper::VAT_PERCENTAGE): float|int
    {
        return round($amount - $amount / (1 + $vat_percentage / 100), 2);
        // e.g VAT excluded: 1.50
    }
}
// ---------------------------------------------------
?>
<!-- How to use -->
<?php
namespace App\Http\Services;
use App\Helpers\VAT_Helper;
class CartService
{
    use VAT_Trait;
    const VAT_PERCENTAGE = 20; // you can skip this because default VAT percentage added i VAT_Trait.
    public function createCartItem(Request $request)
    {
        $product_price = $request->input('product_price'); // e.g 9$
        
        $cartItem =  CartItem::create([
            'product_id' => $request->input('product_id'),
            'sku' => $request->input('sku'),
            'total_weight' => $request->input('weight') * $request->input('quantity'),
            
            // single amount
            'price' => (float) $this->calcAddVatToAmount($product_price, VAT_Helper::VAT_PERCENTAGE), // 2nd parameter is optional
            // single amount * quantity
            'total' => (float) $this->calcAddVatToAmount($product_price * 5, VAT_Helper::VAT_PERCENTAGE),
            // check how much VAT added on single amount
            'tax_amount' => (float) $this->calcVatAddedValue($product_price, VAT_Helper::VAT_PERCENTAGE),
            
            
            // check how much VAT added on (single amount * quantity)
            'total_tax_amount' => (float) $this->calcVatAddedValue($product_price * 5, VAT_Helper::VAT_PERCENTAGE),
        ]);
    }
}
?>

Summary

Using the above example you can calculate VAT on x-amount. Add VAT on x-amount or Exclude VAT on x-amount. And also calculate the added or excluded VAT value on the amount.