How GST is actually calculated — with real examples
GST sounds complicated, but the maths behind it is genuinely simple once you see it laid out. This guide walks through the three things you'll ever actually need to do with GST — add it, remove it, and split it — using real numbers at the rates in force in 2026.
The current GST rates (2026)
Since the GST 2.0 rate rationalisation in September 2025, most goods and services in India fall into a simpler set of slabs:
| Rate | Typically applies to |
|---|---|
| 0% | Essentials — many food items, lifesaving medicines, educational materials |
| 5% | Everyday and essential goods, packaged food, many services |
| 18% | The standard rate — most goods and services, electronics, mobiles |
| 40% | Luxury and sin goods — tobacco, pan masala, select high-end items |
Gold and a few special categories keep their own concessional rates, so always confirm the rate for your specific HSN/SAC code.
Adding GST to a price
This is the everyday case: you have a base price and you need the amount to put on the invoice.
GST = base price × rate ÷ 100
Say you sell a service for ₹10,000 and it's taxed at 18%. The GST is 10,000 × 18 ÷ 100 = ₹1,800, so the invoice total is ₹11,800.
Removing GST (working backwards from a total)
Sometimes you have the final, GST-inclusive price — an MRP, or a total someone quoted you — and you need the base price underneath it. This trips people up, because you can't just subtract 18%.
Base price = total ÷ (1 + rate ÷ 100)
A ₹1,180 item that includes 18% GST has a base price of 1,180 ÷ 1.18 = ₹1,000, which means ₹180 of it was tax. This matters for input-credit checks and for pricing when you want a clean round number after tax.
CGST and SGST — the split
For a sale within your own state, GST is split equally into CGST (central) and SGST (state). At 18%, that's 9% + 9%. On our ₹1,800 of GST, that's ₹900 CGST and ₹900 SGST.
For a sale to another state, the whole amount is charged as a single IGST instead — so 18% IGST, no split.
Our free GST calculator does all of this instantly — add or remove GST at any slab, with the CGST/SGST split worked out for you. Nothing is stored, and it's built for Indian rupees.
A note on compliance
This guide covers the arithmetic, not the filing rules. Whether you must register, which rate applies to your exact product, and how to file returns depend on your turnover, your HSN/SAC classification and place of supply — and those change. For anything binding, check with a Chartered Accountant.
This article is for general information and education, not tax advice.