Completely wrong tax calculation

Question

I have set up a tax rate of 21% (Belgian Tax). This tax rate applies to all products (Taxable Goods) through the needed Tax Rule.

Let's take a product with a price of 6.82€ (tax included). Magento shows "[Inc. Tax €1.18]" on the Price tab for this product.

This is completely wrong: 6.82€ * 0.21 = 1.4322€ (-> compared to 1.18€)

As a result, the tax information on the shopping cart and on invoices are totally wrong.

I have this set-up in System > Configuration > Tax:

• Tax Calculation Method Based On: Total
• Tax Calculation Based On: Shipping Origin
• Catalog Prices: Including Tax
• Shipping Prices: Including Tax
• Apply Customer Tax: Before Discount
• Apply Discount On Prices: Excluding Tax
• Apply Tax On: Custom price if available

I can't find what is going wrong. Any help would be fully appreciated.

Answer 1

Actually the numbers are ok. 6.82 Including tax means that 6.82 = 1.21 * (price_without_tax).
This means that price without tax = 6.82 / 1.21 = 5.64.
And the tax is 6.82 - 5.64 = 1.18.