Excel geekery question

[Galt]

This is where the over thinking comes in. You're wanting to charge someone $100 for your work and not have the sales tax make it less than $100.
So, you will pay the government $10.21 for every $100 you make. You're not 'making' $110.21, you're collecting the tax on the sale from the client, and handing it over to the state.

The only reason I could see wanting to do it the other way is if you didn't want the customer to know that them paying the sales tax was part of the sale?

You're trippin'. He wants $100 for his work. There's nothing complicated about this. It's a nice round number and a shiny $100 bill would look nice sitting snuggly in his wallet. None of this disguises your poor grasp of high-school level mathematics.

[fishmonkey]

it's an easy and very common mistake to make.

the catch is that when you are working forwards, the tax is calculated based only on the pre-tax amount. however, when you are working backwards from the final amount, the tax is being calculated on the whole lot. that is why simply rearranging the forward formula algebraically gives you the wrong result; they are two slightly different questions.

[muthafunka]

'Zakkly, that's why I came to this mighty seat of learning to get the low-down.
Just so you know all this head-scratching was worth it, $100 was an example, tax-only will be a fair chunk more than that.

[Galt]

You should first bill people, then figure out the math later.

[8O]

'Zakkly, that's why I came to this mighty seat of learning to get the low-down.
Just so you know all this head-scratching was worth it, $100 was an example, tax-only will be a fair chunk more than that.

Hi, dunno which calculation you ended up taking in the end, but just to confirm that the simple one is the one to use for invoices and tax.

Here in Germany it's a lovely 19% value added tax, so I'd write an invoice for €100 + 19% tax = €119. Then at the end of the year, the tax authority take that €19 back off me (note, not 19% of 119, but simply the 19% VAT I added). After the tax returns for the year, I have €100. (well, a bit more, but you know what I mean) Hope that helps (?).

[fishmonkey]

Hi, dunno which calculation you ended up taking in the end, but just to confirm that the simple one is the one to use for invoices and tax.

haha, you are right. in most cases the simple reciprocal is used to get back to the pre-tax amount, which is probably what is actually required in this case too...

[beats me]

Here in Germany it's a lovely 19% value added tax

Just learned VAT stands for value added tax. What an insulting name for a tax. The fact that you paid more money for something based on a percentage doesn’t increase its value in any way whatsoever.

[Galt]

Here in Germany it's a lovely 19% value added tax

Just learned VAT stands for value added tax. What an insulting name for a tax. The fact that you paid more money for something based on a percentage doesn’t increase its value in any way whatsoever.

So value isn't cost?

[scott nathaniel]

R.I.P.
MATH

[tkarmakid]

Goal seek under the data tab works well for this too, that is if you still want to use excel for this.

[muthafunka]

Thanks TKK, I'll check it and I do.
FYI this is income tax, as I'm freelance the so-called 'witholding tax', not VAT, hence being taken from the whole rather than added on top at a flat rate. If I were adding our 5% VAT (going up next year) then I would simply *1.05 on top of everything. Often here we work on an in-the-hand price ie what you get after the Matrix has its slice.

[fishmonkey]

yup, sounds like you've got it sorted then.

[Machinesworking]

'Zakkly, that's why I came to this mighty seat of learning to get the low-down.
Just so you know all this head-scratching was worth it, $100 was an example, tax-only will be a fair chunk more than that.

Hi, dunno which calculation you ended up taking in the end, but just to confirm that the simple one is the one to use for invoices and tax.

Here in Germany it's a lovely 19% value added tax, so I'd write an invoice for €100 + 19% tax = €119. Then at the end of the year, the tax authority take that €19 back off me (note, not 19% of 119, but simply the 19% VAT I added). After the tax returns for the year, I have €100. (well, a bit more, but you know what I mean) Hope that helps (?).

That's the crux of it. If your tax authority taxes you on the gross amount you receive, then galt is correct, and if they expect you to collect the tax on your sales for them, then you can do it the way I said. Mostly though galt is correct, taxmen generally want a percentage of your gross, not for you to 'collect' the tax for them. =more tax money for them if you're selling an item that has sales tax added.