Understanding GST Calculation
Goods and Services Tax (GST) can be calculated in two ways depending on whether the tax is already included in the price or needs to be added.
1. GST Exclusive (Adding Tax)
This method is used when you have the factory price and want to calculate the final MRP.
GST Amount = (Original Cost * GST Rate) / 100Net Price = Original Cost + GST Amount
2. GST Inclusive (Removing Tax)
This method is used when you have the MRP and want to find the actual product cost before tax.
GST Amount = Original Cost - [Original Cost * {100 / (100 + GST Rate)}]