Sole trader and ltd company

Geuze

The 150 is 123% of the ex-VAT cost

If you get 23% of the 150, you will NOT be calculating the VAT.

That is a typical mistake made by children doing VAT in the Junior Cert.

150 = 123% of the cost

Divide both sides by 1.23

(150/1.23) = (123%/1.23) = 100%

Geuze

Here is another example to show your mistake.

Take an item that costs 100.

Add 23% VAT = add 23 euro = 123 selling price.

All okay so far?

Now, let us do what you did.

(123) * (0.23) = 28.29, this is the wrong answer.

You are presuming that 23% of the selling price is VAT, but that is false.

VAT is 23% added on to the cost, which IS NOT the same as 23% of the price.

Ciaran

https://www.boards.ie/discussion/comment/121727036#Comment_121727036

If your turnover is less than €2m per year, you can opt to account for VAT when you get paid. Lots of info on revenue's website here.

https://www.boards.ie/discussion/comment/121727094#Comment_121727094

VAT is always calculated on the VAT exclusive price. If the €150 includes VAT, it's made up of the VAT exclusive price of €121.95 and VAT of €28.05 (23% of 121.95).

2024

https://www.boards.ie/discussion/comment/121727263#Comment_121727263

https://www.boards.ie/discussion/comment/121727263#Comment_121727263

I have been working on building sites or private work since i was 14 yrs old. I dont have a junior cert or leaving cert. I cant even spell right. If ya want to know, I have to ask the kids how to spell for me or use the spell checker on the laptop. I have never needed to calculate anything other what i earned or even a simple calculation of adding material costs up for clients. I might be simple in that department of calculating vat because its something ive never needed to do! But put a few tools in my hand and youll see a different side to me. I really appreciate your input into this thread, i do , but i dont appreciate that wee dig about the mistake made by children you mention. Was there any need for it! It might be simple for some but i was finding it difficult, all this add here, take away this then deduct this. It can be daunting for someone like myself whos never done it.

Again thou, thumbs up for the help. Much appreciated!

Geuze

I'm sorry.

Don't worry, your mistake is very common.

People think that if VAT is x%, then the VAT is x% of the final selling price.

Think about it, is 23% of 123 equal to 23 euro...................