VAT on £199?

Question

£199 inc VAT makes the VAT £34.82
Which then means that without VAT £199 equals £164.18
But, £164.18 plus VAT = 164.18x1.175 = £192.91, not £199 !
I am confused, where is the missing £6.09 ?

Oddly enought £6.09 is 17.5% of £34.82
This is really puzzling me now !

Have I uncovered a VAT loop hole ?

http://uk.answers.yahoo.com/question/index;_ylt=ApV7aTPaRU21mfGL.vwRjUEgBgx.?qid=20061128174118AAbLqxF

4 people told me that the VAT was £34.82
Why did we all make it that fiqure ?

GOT IT - GOT IT
£199.00 divide 1.175 = £169.36
£169.36 times 1.175 = £199.00

£199.00 times 1.175 = £34.82 = incorrect !
The VAT is not £34.82
£34.82 is the VAT on £199 not £169.36

Thanks everybody !
God knows how much extra VAT I have charged over the last three years,
My wife does the VAT returns - oops !

Answer 1

199 vat inclusive is net 169.36 vat @17.5% 29.63

You are making a basic mistake that 199 = 100%, where in fact the 199 = 117.5%.

Hope that helps.

Answer 2

By 'costs £199' do you mean is that the cost including VAT, or is that the cost to which Vat must be added? If £199 includes VAT, then the NET cost was £169.36 and the VAT was £29.64 If you are asking for the cost of £199 plus VAT then you simply multiply by 17.5% to find the VAT ( £34.82 )

Answer 3

You go wrong right from the start

"£199 inc VAT makes the VAT £34.82"

WRONG!

If £199 includes VAT then the Net figure is 199 x 100/117.5, i.e. £169.36 and the VAT on that is £29.64:

£169.36 + VAT @ 17.5% (£29.64) = £199 Gross

You cannot calculate the VAT using a figure that already includes VAT simply by multiplying it by 17.5%... thus if £199 includes VAT to multiply that by 17.5% and say (as you do in the first line) the VAT is 34.82 is mistaken

If the figure includes VAT you must divide it by 100 + VAT to find the original net figure, from which you can calculate the vat.

The rest of your question, with the phantom £6.09, follows on from that initial error.

Answer 4

If the £199 includes VAT, then it is actually equivalent to 117.5%.
And the price without VAT would be (100/117.5)x199 = £169.36
or that the VAT paid is £29.64.

You should not be calculating (17.5/100)x199 = £34.82 as the VAT is added to £169.36, and not subtracted from £199.

i.e.
117.5% ==> £199 (as this is the amount AFTER adding the VAT)
100% ==> £169.36 (this is the original amount and is always 100%)

Answer 5

The £6.09 is the 17.5% of the two price differences.
199-164.18 = 34.83
34.83x0.175= 6.09
Its the money that you have lost by using the same base point to take your 17.5% from.
Eg, take 50% away from 100, and you get 50, add 50% back on and you will only get 75 (25 being 50% of 50) hope this helps.
The VAT is actually £29.63.
£169.37x1.175=199, 199-169.37=29.63

Answer 6

I will simplyfy the whole process

If the amount including VAT is 199 pounds, just devide this sum by 1.175, this will give you the net amount of 169.36.

Always devide the gross price by 1.175 ( one point one seven five)

It as easy as that, if the amount of VAT , as in Germany from 1st January is 19%, then devide by 1.19

best wishes

Answer 7

No, the £34.82 is only if you're working out £199 plus VAT. £169. 35 plus VAT is £198.98. Well, not far off!!

Answer 8

£199 is the cost including vat

117.5% =199
therefore,the vat
=17.5/117.5*199=£29.64

check
cost before tax=199-29.64
£169.36

vat on £169.36=169.36*17.5/100
=£29.64

£199 inc vat means £169.36 before
tax plus £29.64 vat

i hope that this helps

Answer 9

vats 29.64 on this without 169.36 if ya search the web ya can get free vat calculators will work it out 4 u everytime

Answer 10

X * 1.175 = 199
X = 169.36