Our 40% is before VAT is added. That's why I'm getting a little lost on how to calculate this figure. So the £1000 is inclusive of VAT but I need to deduct VAT from this amount before I split the nett 40/60. VAT is only due on our commission rate of 40% of the nett
Sorry, that's not what I meant - if I explain it the other way around then perhaps you can see what I'm trying to get at.
If the artist wants £600 for their painting - this figure represents 60% of the nett (excl VAT) selling price.
The gallery's 40% would be £400 and the VAT would only be due on the £400 making the total selling price £1080 split as follows:
Artist = £600
Gallery = £400
VAT = £80
However, in most cases the artist will tell us the selling price and I need to be able to work backwards to get the above 3 elements.