VAT calculator for Malaysia
The standard VAT rate in Malaysia is 8%. To remove it from a gross price you divide by 1.0800, which is not the same as taking 8% off. A sales and service tax rather than a full VAT.
%
Price including VAT
108.00
- VAT to add
- 8.00
- Net price behind a gross one
- 100.00
- VAT inside a gross price
- 8.00
- Line total for the quantity
- 108.00
- VAT fraction of a gross price Multiply a gross figure by this to get the VAT directly.
- 0.074 074
- Gross-up multiplier
- 1.080 000
- How far the subtraction method goes wrong
- 0.64
Show the working
- Price excluding VAT = 100
- VAT rate = 8
- Price including VAT = 108
- Quantity = 1
- VAT to add = 100 * 8 / 100 = 8
- Price including VAT = 100 + 8 = 108
- Line total for the quantity = 108 * 1 = 108
- Net price behind a gross one = 108 / (1 + 8/100) = 100
- VAT inside a gross price = 108 - 100 = 8
- VAT fraction of a gross price = (1 + 8/100) > 0 ? (8/100) / (1 + 8/100) : 0 = 0.074 074 1
- Gross-up multiplier = 1 + 8/100 = 1.08
- wrong_way = 108 * (1 - 8/100) = 99.36
- How far the subtraction method goes wrong = 100 - 99.36 = 0.64
Values are shown to six significant figures here; the arithmetic itself runs on exact fractions and is only rounded where a number is printed.
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The formula
- gross = net x (1 + rate)
- net = gross / (1 + rate)
- VAT fraction of a gross price = rate / (100 + rate) = 0.074074
The VAT fraction is the shortcut accountants use: at 8% you multiply a gross figure by 0.074074 to get the VAT straight out.
Rates and reduced-rate categories change by legislation. The rate here is a default; check the current one before invoicing.
A sales and service tax rather than a full VAT.
Frequently asked
What is the VAT rate in Malaysia?
The standard rate is 8%.
How do I remove VAT from a price?
Divide by 1.0800. Subtracting 8% instead undercharges the net figure every time.
Where the numbers come from
- Standard rates as published by the national tax authorities; reduced and zero rates are not modelled.