How is GST Calculated in India?
GST (Goods and Services Tax) calculation in India follows a straightforward mathematical formula. Understanding these formulas is essential for accurate invoice generation and tax compliance.
✅ Formula to ADD GST (Exclusive Price)
GST Amount = (Original Amount × GST Rate) ÷ 100
Total Price = Original Amount + GST Amount
Example: Product price = ₹10,000, GST Rate = 18%
GST Amount = (10,000 × 18) ÷ 100 = ₹1,800
Total Price = ₹10,000 + ₹1,800 = ₹11,800
✅ Formula to REMOVE GST (Inclusive Price)
Original Amount = (Total Price × 100) ÷ (100 + GST Rate)
GST Amount = Total Price - Original Amount
Example: Total price = ₹11,800, GST Rate = 18%
Original Amount = (11,800 × 100) ÷ 118 = ₹10,000
GST Amount = ₹11,800 - ₹10,000 = ₹1,800
Step 1
Identify the GST rate applicable to your product/service
Step 2
Apply the appropriate formula (add or remove GST)
Step 3
Split into CGST/SGST or IGST based on transaction type