Compare common percentage discounts
Use this table to check the relationship between “percent off” and “percent paid.” The amount saved changes with the original price even when the percentage stays the same.
| Discount | Percentage paid | Saving on 200 | Price before extra tax |
|---|
| 5% off | 95% | 10 | 190 |
| 10% off | 90% | 20 | 180 |
| 15% off | 85% | 30 | 170 |
| 20% off | 80% | 40 | 160 |
| 25% off | 75% | 50 | 150 |
| 30% off | 70% | 60 | 140 |
| 40% off | 60% | 80 | 120 |
| 50% off | 50% | 100 | 100 |
At zero discount, the price is unchanged. At 100% discount, the item price is zero. A value above 100% is not an ordinary price reduction: it would imply a credit beyond the item price, which should be documented separately.
Find a discount rate or reconstruct the original price
When you know the original and sale prices, divide the difference by the original. When you know only the sale price and the advertised percentage reduction, divide by the percentage that remains payable.
Discount % = (original − sale price) ÷ original × 100
Original price = sale price ÷ (1 − discount % ÷ 100)
Equivalent discount % = fixed saving ÷ original price × 100
A product falling from 320 to 272 has a saving of 48, so the discount is 48 ÷ 320 × 100 = 15%. Conversely, a sale price of 272 after 15% off implies 272 ÷ 0.85 = 320 before the offer. The reverse calculation is not unique at 100% off because every original price becomes zero.
Compare prices on the same tax basis. Comparing a tax-exclusive original price with a tax-inclusive sale total mixes the discount with tax and gives a misleading percentage.
Calculate successive discounts without adding percentages
Two percentage discounts normally act on different bases. If 20% is taken off first and another 10% is then taken off the reduced amount, the combined reduction is 28%, not 30%.
Final price = original × (1 − d₁ ÷ 100) × (1 − d₂ ÷ 100)
Combined discount % = [1 − (1 − d₁ ÷ 100)(1 − d₂ ÷ 100)] × 100
On 250, the first discount leaves 200. The second saves 20, leaving 180. Total saving is 70, and 70 ÷ 250 = 28%. You can enter the combined 28% in this calculator or run each stage separately, making the previous discounted price the next original price.
A fixed coupon changes the order. Taking 20 off before a 10% discount on 200 leaves 162; taking it off after the percentage discount leaves 160. Follow the actual offer terms, including excluded products and minimum spends.
Keep discount and tax treatment separate
This page applies the entered tax rate after the reduction. That models a straightforward tax-exclusive sale with a discount that reduces the taxable amount. It is not a determination of local sales-tax or VAT rules.
| Situation | How to handle the calculation |
|---|
| Tax-exclusive price and eligible discount | Apply the discount, then the applicable tax to the reduced base |
| Tax-inclusive displayed price | Do not add the same tax again; extract included VAT separately if needed |
| Several tax rates or exempt items | Calculate the groups separately before adding totals |
| Manufacturer coupon or third-party reimbursement | Check the jurisdiction's tax-base rules rather than assuming every coupon is treated alike |
| Shipping, fees or tips | Determine whether each is discounted or taxable before adding it |
For an included tax breakdown, use the VAT calculator. For a US sales-tax amount, use the sales tax calculator. Keep the quote and final invoice consistent, including any per-line rounding.
Understand what a discount costs the business
A percentage taken from revenue is not the same percentage taken from profit. If a service sells for 1,000 and costs 700 to deliver, the amount above cost is 300. A 10% price reduction removes 100, leaving 200—one-third less than before.
| Offer | Revenue | Unchanged cost | Amount above cost | Margin |
|---|
| No discount | 1,000 | 700 | 300 | 30.00% |
| 5% discount | 950 | 700 | 250 | 26.32% |
| 10% discount | 900 | 700 | 200 | 22.22% |
| 20% discount | 800 | 700 | 100 | 12.50% |
To preserve the original total contribution after a discount, more units may be required. In this example, contribution drops from 300 to 200, so selling 1.5 times as many units is needed to recover the same contribution, assuming unit costs stay unchanged. Capacity, acquisition cost and extra overhead may make that assumption unrealistic.
Review the profit margin before promising a promotion, especially when labor and supplier costs will not fall with the selling price.
Document the offer clearly
State what is discounted, the original basis, the percentage or fixed reduction, the valid period and the conditions. Specify whether shipping, extras and tax are included. For service work, tie the reduction to an agreed scope so a lower price does not accidentally promise additional work.
Use an estimate to show the proposed price, then an invoice for the completed sale. When revising an already issued invoice, use the correction process required for that document rather than changing the historical record silently. The calculator itself does not create a coupon, approve a refund or export a transaction record.