Be Excellent To Each Other

Apparently.

Right, let's assume we're working with 15% VAT here, obv.

I have a PHP function that takes a price excluding VAT, adds 15% VAT to it, and returns that value. Here it is, albeit in simplified form:


Nice and simple, and it works well. Except in very specific circumstances.

If I put in £8.70, for example (which should be £10.00 inc VAT) it returns £10.01, because it works the calculation out as £10.005 and rounds it up.

I've tried changing the round functions to floor() or ceil() and that fixes £8.70, but then breaks other prices.

So, what is the correct, HMRC-approved way of calculating VAT?

The normal way I see in maths for mass spec is to either add or subtract 0.5 from the /100 bit, depending on which works properly. Or maybe from price + tax. Something like that, anyway.

You probably don't really want to round twice, do you?

Yeah, is it do with storing the tax amount as a rounded number?

just have

$tax = $taxrate * $price / 100 ;

?

Malc

I think we use banker's rounding, which is something like rounding .5p to end on an even number.

Aha - like so: http://en.wikipedia.org/wiki/Rounding#R ... lf_to_even

I think what you need here is a Decimal (or Currency) type that will typically implement Bankers Rounding. I don't know if PHP supports such constructs, but if not you could roll your own.

Yeah, the thing I said - undoubtedly inaccurately - balances banker's rounding against always-up that computers do. I think.

Legends, you guys are. Banker's rounding is indeed what I needed.

EoaE clearly has me on ignore.

Has anyone suggested Bankers' Rounding yet?

I think Alastair Darling is going to be changing the definition of Bankers' Rounding this week.

It's going to be called Bankers' Softball from now on.

Dirty

Wankers Rounding?

Dangerous chance of whiplash.

Eh?

Nah, something still isn't right, although my experiences now are mirroring those found on all of the VAT calculators on the 'net (even Digita and other tax accounting firms)

Assume a net price of £34.00.

Take the VAT off, and you're left with £29.57 (£4.43 VAT)

Now, if you put 15% VAT back on 29.57 you get £4.44 VAT for a total of £34.01.

It seems impossible to avoid some sort of rounding error somewhere when dealing with tax. That ain't good.

Are you rounding the second calculation (ie 29.57 * 1.15)?

It's nothing to do with tax, it's just because you're working at a resolution which is the same as the minimum unit of currency.

Store the before-tax amount to 4 decimal places, or just tweak it so that the with-tax value is what you want (i.e. 33.99).

You shouldn't be converting back and forth anyway, just do one conversion.

Skim off those extra pennies into your own private account. You'll make millions and they'll never even notice.

Careful.

My customers want the flexibility to input their prices either in net or gross, but I want to store the prices gross so that the items can be resold in countries with different tax rates without the system throwing a fit.

Think I've got a handle on it now anyway.

i just discovered on grim's link that some people call it dutch rounding, so clearly i'm entitled to suggest it once more