What is GST?

GST (Goods and Services Tax) is India’s unified indirect tax system, introduced on July 1, 2017 to replace multiple central and state taxes including service tax, VAT, central excise, octroi, and entry tax. GST is a consumption-based tax collected at the point of sale and remitted to the government. India operates a dual GST structure: Central GST (CGST) collected by the central government and State GST (SGST) collected by states for intra-state transactions, or Integrated GST (IGST) for inter-state and import transactions. India uses a 4-tier rate structure (5%, 12%, 18%, 28%) plus special rates for essentials (0%) and luxury items (some attract a cess on top). Whether you’re a business owner pricing products, an accountant filing returns, or a consumer trying to understand a bill, the GST calculator handles all the math instantly.

How to use this tool

1. Choose mode — ‘Add GST’ takes a base amount and adds tax to get total. ‘Remove GST’ takes a total (tax-inclusive) and extracts the base amount.
2. Enter the amount — In Add mode this is the base (pre-tax) amount. In Remove mode this is the total (inclusive) amount.
3. Select GST rate — Choose from standard rates: 0% (essentials), 5% (necessities), 12% (processed foods, computers), 18% (most goods/services – standard), 28% (luxury). Or enter a custom rate for special cases.
4. Read the result — Total (or base), GST amount, and CGST/SGST or IGST split. For most domestic purchases, GST is split 50/50 into CGST and SGST.
5. Use in invoices — Copy the CGST and SGST amounts into your invoice. They must be shown separately as required by GST law.

GST formula and split

Add GST: Total = Base + (Base × GST% / 100)

Remove GST: Base = Total / (1 + GST% / 100)

GST split rules:

• Intra-state sale (buyer and seller in same state): Tax split equally into CGST + SGST. Example: 18% GST = 9% CGST + 9% SGST. Both go to respective tax authorities.
• Inter-state sale (buyer and seller in different states) or export/import: Full tax charged as IGST. Goes to central government, later distributed.

Example: A ₹1,000 service in Mumbai sold to a Mumbai customer at 18% GST:

• CGST = 1,000 × 9% = ₹90
• SGST = 1,000 × 9% = ₹90
• Total GST = ₹180
• Invoice total = ₹1,180

Same service to a Bangalore customer: full ₹180 charged as IGST, invoice total still ₹1,180.

Examples

• Restaurant bill, ₹1,000 food, 5% GST: CGST ₹25 + SGST ₹25 = ₹1,050 total
• SaaS subscription, ₹5,000, 18% GST: CGST ₹450 + SGST ₹450 (or IGST ₹900 if inter-state) = ₹5,900 total
• Car purchase, ₹10 lakh, 28% GST: CGST ₹1.4 lakh + SGST ₹1.4 lakh + (1% cess for some categories) = ₹12.8 lakh + cess
• Reverse calc: hotel bill total ₹11,800 includes 18% GST. Base = 11,800 / 1.18 = ₹10,000. GST = ₹1,800.
• Gold jewelry, ₹50,000, 3% GST: CGST ₹750 + SGST ₹750 = ₹51,500 total

Tips & best practices

• Always issue GST-compliant invoices showing CGST, SGST, IGST separately – it’s required by law
• If your annual turnover exceeds ₹20 lakh (services) or ₹40 lakh (goods), GST registration is mandatory
• Composition Scheme is available for small businesses with turnover under ₹1.5 crore – lower rates (1-6%) but no input tax credit
• Keep all input tax credit (ITC) invoices for at least 6 years – GST audits may go back that far
• For inter-state sales, charge IGST (not CGST/SGST). Buyer claims it as credit in their state
• GST on advance payments (deposits) must be paid in the period received, even before goods/services are delivered
• E-way bills are mandatory for inter-state goods movement above ₹50,000 – generate them at ewaybill.nic.in

Limitations & notes

GST rates change occasionally – this calculator uses the rates current as of 2026. Special schemes (composition, reverse charge mechanism, place-of-supply rules for OIDAR services) may have different treatments not reflected here. For business filings, always consult a Chartered Accountant or refer to the official GSTN portal at gst.gov.in. Some items also attract a GST Compensation Cess (luxury cars, tobacco, aerated drinks) which is not included in standard rates above.

Frequently Asked Questions

What are the current GST rates in India?

India has 5 main GST slabs: 0% (essential food, healthcare, education), 5% (household necessities, transportation), 12% (processed foods, mobile phones, computers), 18% (most goods and services – the standard rate), and 28% (luxury items – cars, tobacco, premium hotels). Some specific items (gold 3%, rough diamonds 0.25%) have unique rates.

What is the difference between CGST, SGST, and IGST?

For sales within the same state, GST is split into CGST (central government share) and SGST (state government share) – usually 50/50. For sales between different states or international transactions, the full amount is charged as IGST (Integrated GST) which the central government later distributes to states. As a consumer the total tax is the same; only the tax authority changes.

How do I know which GST rate applies to my product?

GST rates are defined by HSN (Harmonized System of Nomenclature) codes for goods and SAC (Service Accounting Code) for services. Check the official rate finder at cbic-gst.gov.in or refer to your CA. Common rates: most software/SaaS = 18%, restaurant food = 5%, packaged staples = 5%, cars = 28%+cess, clothes under ₹1000 = 5%.

Is GST included in MRP?

Yes – MRP (Maximum Retail Price) is the all-inclusive price for end consumers and already includes GST. You cannot legally charge above MRP. Some businesses still wrongly add GST on top – that is illegal and you can complain to consumer court.

What is Input Tax Credit (ITC)?

ITC is the GST you’ve paid on purchases that you can deduct from the GST you collect on sales. For example: if you pay ₹1,800 GST on raw materials and collect ₹3,000 GST on sales, you remit only ₹1,200 (3,000 – 1,800) to the government. ITC is the core mechanism that prevents tax-on-tax cascading.

Do small businesses need to register for GST?

GST registration is mandatory if annual turnover exceeds ₹40 lakh (goods) / ₹20 lakh (services) / ₹10 lakh (special category states). It’s also mandatory for inter-state sellers, e-commerce sellers, and certain professionals regardless of turnover. Voluntary registration is available below thresholds and may be beneficial for B2B sellers (allows ITC pass-through).

How is GST calculated on imports?

Imported goods attract Basic Customs Duty (BCD) first, then IGST on the customs-duty-inclusive value. Example: ₹100 imported goods + 10% BCD = ₹110; then 18% IGST on ₹110 = ₹19.80. Final landed cost = ₹129.80 (excluding shipping/insurance which also factor in).

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