1. What is Reverse TPS/TVQ Calculation?

The reverse TPS/TVQ calculation determines the original price before taxes when you know the total amount paid. This is useful for accounting, expense reporting, and understanding tax breakdowns.

2. How Does the Calculator Work?

The calculator uses the reverse tax formula:

Where:

• \( Total \) — Total amount paid including taxes (CAD)
• \( TPS \) — Provincial sales tax rate (5% or 0.05)
• \( TVQ \) — Quebec sales tax rate (9.975% or 0.09975)

Explanation: The formula accounts for the compounding effect of applying both TPS and TVQ taxes sequentially.

3. Importance of Reverse Tax Calculation

Details: Reverse tax calculation helps businesses separate taxable and non-taxable amounts, prepare accurate financial statements, and claim appropriate tax credits.

4. Using the Calculator

Tips: Enter the total amount paid in CAD, the TPS rate (default 5%), and TVQ rate (default 9.975%). All values must be valid positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Why is there a TPS×TVQ term in the formula?
A: This accounts for the TVQ being applied to the price after TPS has already been added (tax on tax).

Q2: What if I only have TPS or only TVQ?
A: For TPS only, set TVQ to 0. For TVQ only, set TPS to 0. The formula will simplify accordingly.

Q3: Are these the current tax rates in Quebec?
A: As of 2023, standard rates are 5% TPS and 9.975% TVQ, but always verify current rates with official sources.

Q4: Can this be used for other provinces?
A: Yes, by adjusting the tax rates. The same formula works for any two sequential taxes.

Q5: How accurate is this calculation?
A: It's mathematically precise for the given rates. Rounding may cause minor differences of a few cents.