Posh Imp wrote:
Davethe cardboardbox wrote:
£1.2 million minus Mr Vat of 240k.
The maths is wrong. VAT is at 20% therefore the base figure from £1.2m is £1m not £960,000
£1,000,000 plus 20% = £1,200,000 so the VAT element is only £200,000 NOT £240,000 as you suggested.
20% of £1,200,000 is quite rightly £240,000 but that is NOT how VAT works. You can only go back to the base figure then ADD the 20% VAT. In this case, the base figure is £1,000,000 plus VAT at 20% (£200,000) = £1,200,000.
If you then try to remove 20% from that figure, which Helgy did, then, yes that does add up to £240,000 but the maths is WRONG because he was also including the 20% of the £200,000 which has been added as VAT.
It really is not difficult!