The sums
| You have | You want | Do this | Example |
|---|---|---|---|
| A price before GST | The price with GST | × 1.15 | $200 × 1.15 = $230 |
| A price before GST | Just the GST | × 0.15 | $200 × 0.15 = $30 |
| A total with GST | The GST inside it | × 3 ÷ 23 | $230 × 3 ÷ 23 = $30 |
| A total with GST | The price before GST | ÷ 1.15 | $230 ÷ 1.15 = $200 |
GST calculator
- Before GST
- GST at 15%
- Including GST
Why not just take 15% off?
Because the 15% was added to the price before GST, not to the total. Take 15% off a $115 total and you get $17.25, not $15. On one invoice that's small; across a year of GST returns, it's money you paid Inland Revenue that you didn't owe.
Rounding
GST is rounded to the nearest cent. Work it out once on the invoice total, or on each line and add the rounded lines, and do it the same way every time. The 3/23 and "divide by 1.15, then subtract" give the same answer; 3/23 just gets you the GST in one step.
Worked example
Aroha's invoice to a café: garden design $1,200 and a printed planting plan $380, both before GST.
| Amount | |
|---|---|
| Garden design | $1,200.00 |
| Planting plan, printed | $380.00 |
| Subtotal | $1,580.00 |
| GST 15% | $237.00 |
| Total | $1,817.00 |
Check it backwards: $1,817.00 × 3 ÷ 23 = $237.00 of GST.
GST in your prices
Quoting homeowners? Work out your price before GST, multiply by 1.15, and quote the total: a $95 hourly rate before GST is $109.25 including GST. Prefer a round $110? Work backwards: $110 × 3 ÷ 23 is $14.35 of GST, leaving you $95.65. Quotes and GST has the wording to use.