Discount Calculator
Calculate sale prices, discount percentages, and stacked discounts.
How Discounts Work
A discount is a reduction in the regular price of a product or service. Calculating the sale price is straightforward: Sale Price = Original Price × (1 − Discount% / 100). For example, a £100 item at 25% off costs £75. The savings are £25. While this math is simple, it becomes more complex with stacked discounts, tax considerations, and comparing different types of deals.
Why 20% + 10% ≠ 30%
One of the most common misconceptions is that stacked discounts add up. If a store offers 20% off and then an additional 10% off the sale price, the total discount is NOT 30%. Here's why: £100 − 20% = £80. Then £80 − 10% = £72. The effective discount is 28%, not 30%. The second discount applies to the already-reduced price, not the original. This is true for all stacked percentages — they multiply, not add.
Retail Pricing Psychology
Retailers use psychological pricing strategies to make deals seem better than they are. "25% off" feels different from "save £25" even when they're the same amount. Studies show percentage discounts work better for lower-priced items (under £100), while absolute savings work better for expensive items. "Buy one get one free" sounds better than "50% off" even though the math is identical. Understanding these tactics helps you make better shopping decisions.
Finding the Best Deal
To truly maximize savings, combine multiple strategies: use cashback apps (like Rakuten or TopCashback), stack manufacturer coupons with store sales, use credit cards that offer purchase rewards, check price history tools (like CamelCamelCamel for Amazon), and compare prices across retailers before buying. A 20% discount with 5% cashback and a 2% credit card reward effectively gives you about 26% off.
VAT and Tax on Discounts
In most countries, sales tax or VAT is calculated on the discounted price, not the original price. If an item is originally £100 with 20% off, the sale price is £80, and VAT at 20% is calculated on £80 (£16), making the final price £96. However, some promotional structures (like gift-with-purchase) may have different tax implications. Always check the final price including tax when comparing deals.