VAT Calculator

How to use this VAT calculator

Pick your currency (£ or €) and choose whether you want to add VAT or remove it. To add VAT, enter a net (VAT-exclusive) price and the calculator returns the gross price your customer pays. To remove VAT, enter the gross (VAT-inclusive) price and it works backwards to the net price plus the VAT portion. Set the rate to whatever applies to your sale — 20% is the UK standard rate, but you can dial in any rate from 0% to 27%.

How this is calculated

Adding VAT is simple multiplication: VAT = net × rate ÷ 100, and gross = net + VAT. Removing VAT reverses the maths — because the gross figure already contains the tax, you divide rather than subtract: net = gross ÷ (1 + rate ÷ 100), and the VAT = gross − net. Dividing is the step people most often get wrong; subtracting the rate directly from a gross price overstates the VAT and understates the net.

Educational estimate, not tax advice — see our disclaimer.

A worked example

Say you sell a product for a net price of £100 at the UK standard rate of 20%. The VAT is £100 × 20 ÷ 100 = £20, so the gross price on the invoice is £120. Now run it the other way: a customer hands you a receipt showing £120 including VAT and you need the net figure. You divide, not subtract: £120 ÷ 1.20 = £100 net, leaving £20 of VAT. Notice that subtracting 20% of £120 would have given £24 — that is the classic mistake, and it is why the divide step matters.

Tips for getting VAT right

• Know which rate applies. Many countries have reduced rates for food, books, children's items or energy, alongside the standard rate.
• Keep net and gross straight. Quotes to businesses are usually shown ex-VAT; prices to consumers are usually shown inc-VAT.
• Round at the end. Calculate on full figures and round the final amounts so small penny differences do not accumulate.
• Check cross-border rules. VAT treatment for sales between countries can differ from a domestic sale.

VAT rates vary and change

VAT rates are set by each government and are revised from time to time, so always confirm the current rate for the country and product before you rely on a figure. The UK standard rate is 20%, with a reduced 5% rate and a 0% rate on some goods. Across the EU, standard rates range roughly from the high teens to the mid-twenties, with assorted reduced rates on top — they are not uniform and they do move. This tool does the arithmetic; you supply the correct rate.

Selling in the US instead? Use our sales tax calculator. For Australia, Canada, India and similar systems, the GST calculator works the same way.