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How to Calculate GST: Adding It, Removing It, and Splitting CGST and SGST
Quick Work Studio · 2026-10-01
Whether you run a small business, freelance, or just want to check a bill, two GST calculations come up again and again: adding GST to a price, and working out how much GST is already inside a price. Both are simple once you see the formula, and one of them trips up a lot of people.
Adding GST to a price
To add GST, multiply the price by the rate and add the result. For a ₹2,000 item at 18%:
- GST = 2,000 × 18 ÷ 100 = ₹360
- Total = 2,000 + 360 = ₹2,360
A shortcut is to multiply by 1 plus the rate as a decimal: 2,000 × 1.18 = ₹2,360.
Removing GST from an inclusive price
If a price already includes GST, divide it by 1 plus the rate. For ₹2,360 including 18% GST:
- Price before GST = 2,360 ÷ 1.18 = ₹2,000
- GST included = 2,360 − 2,000 = ₹360
The most common mistake
Many people simply subtract 18% from the inclusive price: 2,360 − 18% = ₹1,935.20. That's wrong, because the 18% was charged on the lower pre-tax price of ₹2,000, not on ₹2,360. Subtracting the percentage removes too much tax, ₹424.80 instead of ₹360. Always divide by 1.18 (or 1.05, or whichever rate applies) to reverse GST.
CGST, SGST and IGST
When goods or services are sold within one state, GST is split equally between the central and state governments: 18% GST appears on the invoice as 9% CGST and 9% SGST. On our ₹2,000 example, that's ₹180 CGST plus ₹180 SGST. When the sale is between two states, the full 18% is charged as IGST instead. The total tax is the same either way, only the way it's labelled and shared changes.
Discounts and GST
When a discount is shown on the invoice at the time of sale, GST is calculated on the discounted price. A ₹2,000 item with 10% off becomes ₹1,800, and 18% GST on that is ₹324, for a total of ₹2,124. Use the Discount Calculator first, then add GST to the result.
Which rate applies?
GST rates depend on what's being sold and are revised from time to time. A major reform in September 2025 simplified most goods and services into two main rates, 5% and 18%, with a higher rate for a small group of luxury and "sin" goods. Always check the current rate for your specific product or service before relying on a calculation.
Rounding on invoices
Invoices are usually rounded to two decimal places for each tax line. If you're splitting GST into CGST and SGST, calculate each half and round it separately, so the two lines add up neatly to the total tax shown.
Try it: our Sales Tax / GST Calculator adds GST, removes GST from inclusive prices and shows the CGST and SGST split in one step. For offers, the Discount Calculator works out the sale price first.