How to calculate GST: add it to a price, or take it out of a total

Every GST sum is one of two questions. Either you have a price and want to know what to charge, or you have a total and want to know how much of it is tax. The first is a multiplication. The second is a division, and it is the one people get wrong.

Adding GST to a price

GST is charged on the price before tax, which the law calls the taxable value. To add it, multiply that price by the rate:

GST = price × rate ÷ 100

Total = price + GST

A few examples, worked the way an invoice works them:

Price	Rate	GST	Total
₹1,000	5%	₹50	₹1,050
₹1,000	18%	₹180	₹1,180
₹10,000	40%	₹4,000	₹14,000
₹1	18%	₹0.18	₹1.18

That is the whole of the forward direction. The only decision in it is the rate, which depends on what you are selling, not on who is buying.

Taking GST out of a total

This is the question behind every rounded price tag, restaurant bill and quotation “inclusive of all taxes”. You know the total. You want the part that is tax.

The total is the price plus the tax, which is the price times (1 + rate). So you undo it by dividing:

Price before tax = total ÷ (1 + rate ÷ 100)

GST = total − price before tax

At 18%, divide by 1.18. At 5%, divide by 1.05. At 40%, divide by 1.40.

Total	Rate	Price before tax	GST inside it
₹1,180	18%	₹1,000	₹180
₹2,360	18%	₹2,000	₹360
₹500	5%	₹476.19	₹23.81
₹1,000	5%	₹952.38	₹47.62

Work out the price first, round it to the paisa, and then take the GST as whatever is left of the total. That way the two parts always add back up to exactly the amount you started with, which is what anyone checking your bill will test first.

The mistake that overstates the tax

The tempting shortcut is to take 18% of the total. On ₹1,180 that gives ₹212.40. The real tax is ₹180, so the shortcut is out by ₹32.40, and the error grows with the rate and the amount.

The 18% was charged on ₹1,000, not on ₹1,180. The tax is 18 parts out of 118, not 18 out of 100. If you want a single multiplier for the tax inside a total, use rate ÷ (100 + rate):

• 5% inclusive: 5 ÷ 105, about 4.76% of the total
• 18% inclusive: 18 ÷ 118, about 15.25% of the total
• 40% inclusive: 40 ÷ 140, about 28.57% of the total

Which rate applies

The slab structure changed on 22 September 2025, in the reform usually called GST 2.0. The main slabs are now 0%, 5%, 18% and 40%. The old 12% slab was removed, as was 28% for most goods, and items moved into the neighbouring slabs. A few special rates sit outside the main four: 3% on gold, silver and jewellery, and 0.25% on rough diamonds.

The rate belongs to the item, identified by its HSN code for goods or SAC code for services. Two things that look alike can sit in different slabs. Look the code up rather than going by memory (how to find an HSN code), and confirm it at the official CBIC rate finder before it goes on an invoice. A rate from before September 2025 may simply no longer exist.

Rounding, and bills with several items

Two rules keep your numbers matching anyone else’s:

1. Round the tax on each line, then add the lines. An invoice with a 5% item and an 18% item calculates each line on its own. Adding the prices first and applying one rate is not just wrong on the rate, it also rounds differently.
2. Round the total tax, then split it. Within a state the tax is divided into CGST and SGST. Split the rounded total, rather than rounding each half separately, or the halves can add up to a paisa more than the tax. Our guide to CGST, SGST and IGST covers the split in full.

Doing it without the arithmetic

GST Calculator does both directions from the same keypad: type the amount, tap a rate, and read the price, the tax and the total. It keeps the parts adding back to the amount you typed, splits the tax into CGST and SGST or shows it as IGST, and looks up a rate by product name or HSN code. It works offline and asks for no account. You can also use it in your browser, with nothing to install.

It is an independent app, not a government one. It calculates and informs, and it does not file returns.