VAT Calculator — Add or Remove VAT from Any Price Instantly

Q: How do I calculate VAT?

To add VAT to a price multiply the net price by (1 + VAT rate). For example a £100 product with 20% UK VAT: £100 x 1.20 = £120 gross price. To remove VAT from a gross price divide by (1 + VAT rate). For example £120 divided by 1.20 = £100 net price. The VAT amount is always the difference between gross and net price.

Q: What is reverse VAT calculation?

Reverse VAT or VAT extraction means working backwards from a gross price to find the original net price and VAT amount. Formula: Net price = Gross price divided by (1 + VAT rate). VAT amount = Gross price minus Net price. Example at 20% VAT: Gross £120 divided by 1.20 = £100 net. VAT amount = £120 minus £100 = £20. Use the Remove VAT mode in our calculator above.

Q: What is GST and how is it different from VAT?

GST stands for Goods and Services Tax and is functionally similar to VAT — both are consumption taxes collected at each stage of production. Countries like Australia, Canada, India, Pakistan and New Zealand use GST while European countries use VAT. The main difference is the name and rate. Australia GST is 10 percent. Pakistan GST is 17 percent. India GST varies from 5 to 28 percent depending on the product category.

Q: How do I calculate VAT for multiple items?

For multiple items first add up all net prices then apply VAT to the total. For example three items at £50, £75 and £25 net total £150. At 20% UK VAT the gross total is £150 x 1.20 = £180 with £30 VAT. Alternatively calculate VAT on each item separately and sum the VAT amounts — the result is the same. Use our bulk VAT calculator tab to calculate multiple items at once.

🧮 VAT Calculator

Add VAT to a net price or remove VAT from a gross price

Net Price (before VAT)

VAT Rate

Currency

Net Price

£100.00

before VAT

VAT Amount

£20.00

20% VAT

Gross Price

£120.00

total to pay

Price Breakdown

Net

VAT

💡 VAT Quick Summary

Enter a price above to see your VAT breakdown instantly.

How to Calculate VAT

VAT (Value Added Tax) is a consumption tax applied at each stage of production and distribution. Understanding how to add and remove VAT correctly is essential for businesses, freelancers and consumers worldwide.

ADD VAT to a net price: Gross Price = Net Price × (1 + VAT Rate / 100) VAT Amount = Gross Price − Net Price Example: £100 net price + 20% UK VAT: Gross = £100 × 1.20 = £120 VAT Amount = £120 − £100 = £20 REMOVE VAT from a gross price (Reverse VAT): Net Price = Gross Price / (1 + VAT Rate / 100) VAT Amount = Gross Price − Net Price Example: £120 gross price with 20% VAT: Net = £120 / 1.20 = £100.00 VAT Amount = £120 − £100 = £20.00

VAT Rates Around the World

United Kingdom: 20% standard, 5% reduced, 0% zero rated
European Union: 17-27% depending on country
Pakistan: 17% GST standard rate
Australia: 10% GST on most goods and services
India: 5%, 12%, 18% or 28% GST depending on goods category
UAE: 5% VAT introduced in 2018
Saudi Arabia: 15% VAT since 2020
Canada: 5% federal GST plus provincial taxes

VAT Inclusive vs VAT Exclusive

When a price is shown VAT exclusive it means VAT has not been added yet — this is the net price. When a price is shown VAT inclusive it means VAT is already included — this is the gross price. In the UK and most countries consumer-facing prices must be shown VAT inclusive. Business to business invoices typically show both the net price and VAT amount separately.

⚠️ Disclaimer: VAT rates shown are for general guidance and may not reflect the most current rates. Tax laws change frequently. Always verify current rates with your local tax authority or a qualified accountant before making financial or business decisions. This tool does not constitute tax advice.

Complete Guide to VAT — How It Works

Value Added Tax (VAT) is a consumption tax applied to goods and services at each stage of production and distribution. As a buyer you pay the full VAT-inclusive price. As a business owner understanding VAT is essential for correct pricing, invoicing and tax compliance. Our VAT calculator handles both adding VAT to a net price and removing VAT from a gross price instantly.

VAT Rates by Country — 2024 Reference

Country	Standard VAT Rate	Reduced Rate
🇬🇧 United Kingdom	20%	5%
🇩🇪 Germany	19%	7%
🇫🇷 France	20%	5.5% / 10%
🇦🇺 Australia (GST)	10%	0%
🇵🇰 Pakistan	17%	10%
🇸🇦 Saudi Arabia	15%	—
🇦🇪 UAE	5%	0%
🇨🇦 Canada (GST)	5%	0%

How to Add VAT to a Price

Add VAT Formula:
Gross Price = Net Price × (1 + VAT Rate/100)
VAT Amount  = Gross Price - Net Price

Example — £100 net price + 20% UK VAT:
Gross = £100 × 1.20 = £120.00
VAT   = £120 - £100 = £20.00

How to Remove VAT from a Price

Remove VAT Formula:
Net Price  = Gross Price ÷ (1 + VAT Rate/100)
VAT Amount = Gross Price - Net Price

Example — £120 gross price, remove 20% UK VAT:
Net  = £120 ÷ 1.20 = £100.00
VAT  = £120 - £100 = £20.00

Common mistake: Do NOT calculate £120 × 20% = £24!
The correct VAT in a £120 price is £20 not £24!

💼 Tax Disclaimer: VAT rates and rules change frequently. Always verify current rates with your local tax authority. This calculator provides estimates for informational purposes only and does not constitute tax advice.

VAT Rates by Category — UK Reference

Not all goods and services attract the same VAT rate in the UK. Use our sales tax calculator for US calculations and our percentage calculator for quick percentage work on any value.

Rate	%	Applies To
Standard	20%	Most goods, electronics, clothing
Reduced	5%	Home energy, children car seats
Zero	0%	Food, books, children clothing

VAT Registration — When Your Business Must Register

UK businesses must register for VAT when taxable turnover exceeds £90,000 in any rolling 12-month period (2024). Once registered you must charge VAT on sales, file quarterly returns and pay HMRC the difference between VAT collected and VAT paid on purchases.

For businesses that make both VAT-taxable and VAT-exempt supplies, partial exemption rules apply and the calculation becomes more complex. A common example is a business that sells both commercial software (taxable at 20%) and financial services (exempt). Only the input VAT relating to taxable supplies can be reclaimed. The partial exemption standard method pro-rates recoverable VAT based on the ratio of taxable to total supplies. Many small businesses find it worthwhile to restructure their supply mix to maximise VAT recovery. Always consult a qualified accountant when partial exemption applies to your business.

Making Tax Digital (MTD) for VAT is now mandatory for all VAT-registered businesses in the UK. This requires keeping digital VAT records and submitting returns using MTD-compatible software directly to HMRC. There is no longer an option to submit manually through the HMRC website. Approved MTD software includes Xero, QuickBooks, Sage and FreeAgent among others. The penalties for non-compliance with MTD requirements can be significant, so ensuring your accounting software is MTD-compliant is essential if your business is VAT-registered.

International VAT and GST Rates — Global Overview

Value Added Tax exists in over 160 countries worldwide under various names including GST (Australia, Canada, India, New Zealand), IVA (Spain, Italy, Mexico), TVA (France) and Mehrwertsteuer (Germany). Rates vary significantly from Hungary at 27% to Canada at 5% for federal GST. For UK businesses selling to EU consumers post-Brexit the EU One Stop Shop (OSS) scheme simplifies VAT compliance for digital services and goods. Businesses selling more than £135 of goods to UK consumers are now responsible for collecting and remitting UK VAT at the point of sale regardless of where they are based. Understanding these rules is essential for any business trading internationally. Our calculator handles UK VAT rates but always verify rates with the relevant tax authority for cross-border transactions.

Cash accounting for VAT allows businesses with taxable turnover below £1.35 million to account for VAT on the basis of payments received and made rather than invoices issued. This means you do not pay VAT to HMRC until your customer actually pays you, which significantly improves cash flow for businesses with slow-paying customers. The annual accounting scheme lets eligible businesses pay VAT in advance instalments and submit one annual return instead of four quarterly returns, further reducing administration. These optional schemes are worth considering for any small VAT-registered business to optimise cash flow and reduce compliance burden.

For sole traders and small partnerships keeping VAT records manually is permitted but digital records via MTD software are now mandatory for all VAT-registered entities. The key records required include VAT account (a summary of VAT on sales and purchases), VAT invoices for standard-rated supplies above £250, and simplified VAT invoices for amounts below £250. Records must be kept for 6 years. Getting these fundamentals right from the start of VAT registration prevents penalties and makes quarterly filing straightforward.

Frequently Asked Questions

How do I calculate VAT? +

To add VAT multiply the net price by (1 + VAT rate). Example: £100 net with 20% UK VAT equals £100 × 1.20 = £120 gross. To remove VAT from a gross price divide by (1 + VAT rate). Example: £120 gross divided by 1.20 = £100 net price. The VAT amount is always the difference between gross and net. Use our calculator above for instant results without any math.

What is the VAT rate in the UK? +

The UK has three VAT rates. Standard rate is 20 percent which applies to most goods and services. Reduced rate is 5 percent which applies to home energy, children's car seats and some other goods. Zero rate applies to most food, children's clothing, books, newspapers and public transport. Businesses must register for VAT if their taxable turnover exceeds £90,000 per year.

What is the difference between VAT inclusive and VAT exclusive prices? +

A VAT exclusive price is the net price before VAT is added — businesses typically quote this to other businesses. A VAT inclusive price is the gross price after VAT has been added — this is what consumers pay in shops. When a price tag shows £120 VAT inclusive at 20% the net price is £100 and the VAT amount is £20. Our calculator handles both directions instantly.

What is reverse VAT calculation? +

Reverse VAT means working backwards from a gross price to find the original net price and VAT amount. Formula: Net price = Gross price divided by (1 + VAT rate). VAT amount = Gross price minus Net price. Example at 20% VAT: Gross £120 divided by 1.20 = £100 net. VAT amount = £20. Select Remove VAT mode in our calculator above for instant reverse VAT calculation.

What is GST and how is it different from VAT? +

GST stands for Goods and Services Tax and works identically to VAT — both are consumption taxes added to prices. Countries like Australia, Canada, India, Pakistan and New Zealand use the term GST while European countries use VAT. The calculation method is exactly the same. Australia GST is 10 percent. Pakistan GST is 17 percent. India GST varies from 5 to 28 percent depending on the product category.

Which countries have the highest VAT rates? +

The highest VAT rates globally are Hungary at 27 percent, Denmark Norway and Sweden at 25 percent, Finland Greece and Iceland at 24 percent and Poland and Portugal at 23 percent. The UK standard rate is 20 percent. The US does not have a federal VAT — individual states have sales taxes ranging from 0 to over 10 percent. View our complete country VAT rates table in the Countries tab above.

How do I calculate VAT for multiple items? +

For multiple items add up all net prices then apply VAT to the total. Three items at £50, £75 and £25 total £150 net. At 20% UK VAT the gross total is £150 × 1.20 = £180 with £30 VAT. Or use our Bulk Calculator tab above to enter all items individually and see the total VAT, net and gross instantly — perfect for invoices and expense tracking.

Free VAT Calculator