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How to Calculate Sales Tax Backwards from Total.
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How to Calculate Sales Tax Backwards from Total.

Rosemary Njeri

What is Reverse Sales Tax?

Basically speaking, sales tax backwards from total is in fact the reverse sales tax. When you purchase goods, you may wonder how much these items actually cost before the sales tax gets added to them. Either that or you may want to check the accuracy of the sales tax indicated on your item’s receipt. Fortunately, you can get this amount easily using the sales tax de-calculator.

Reverse sales tax is not something you pay, its something you calculate. The computations remain the same whether you’re performing a reverse sales tax calculation using a receipt that you have, or you’re trying to figure out the price of an item before the taxes

Formula to Calculate Sales Tax Backwards from Total.

In this formula, we assume that you already know the sales tax percentage.

  • Divide your sales receipts by 1 plus the sales tax percentage.
  • Multiply the result by the tax rate, and you get the total sales-tax dollars.
  • Subtract that from the receipts to get your non-tax sales revenue.

Example:

Suppose your sales receipts amounted to $ 1200 and the sales tax rate is 12%. Calculate the reverse sales tax.

 Sales Tax Backwards from Total.
 Sales Tax Backwards from Total.

Therefore, your sales tax is $ 129.

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