Tax collected is not profit. Strip sales tax from revenue and comparable costs before measuring true merchandise margin.
Tax collected is not profit. Strip sales tax from revenue and comparable costs before measuring true merchandise margin.
Step 2 — Your breakdown
We reverse the tax using the standard formula:
Enter a total and tax rate to see your breakdown.
Booking tax as revenue inflates margin. Reverse-calculate tax on tax-inclusive sales and inventory purchases, then compute margin on net merchandise.
Pair with retail markup and remover tools for a full sourcing-to-sale workflow.
You paid $108.25 including 8.00% sales tax and need the merchandise amount for bookkeeping.
Pre-tax: $100.23 | Tax: $8.02 | Total: $108.25
Reverse math is for splitting receipts and estimates—it does not replace filing obligations, nexus analysis, or professional tax advice. Confirm rates with your state revenue department or marketplace reports before remitting.
No—collected sales tax is a liability until remitted. Margin analysis should exclude it from revenue.
