Reverse VAT calculator
Divide the gross by one plus the rate. A 242 total at 21% VAT is 200 net and 42 VAT. Subtracting 21% from 242 would give 191.18, which is wrong by nearly nine: a mistake that compounds across an expense claim.
How to reverse VAT
The reason subtraction fails is that the percentage was applied to the smaller number. Twenty-one per cent of 200 is 42, but 21% of 242 is 50.82: you would be removing tax on the tax. The VAT fraction sidesteps the arithmetic entirely: multiply the gross by 21/121 and you have the tax directly. At the UK 20% rate the fraction simplifies to a memorable 1/6, which is why British bookkeepers divide receipts by six in their heads.
Questions
Divide by 1.21 at 21%, or by 1.20 at 20%. Never subtract the percentage from the gross.
One sixth. Divide any 20%-inclusive total by six to get the VAT.
Because the tax was calculated on the net, not the gross. Subtracting removes tax on the tax as well.
42. The net is 200.
No. Reverse charge is a cross-border VAT mechanism where the customer accounts for the tax. This is just arithmetic.