VAT Calculator
Add VAT to a net price, or work out the VAT hidden inside a gross price. Standard rate 20%, reduced 5%, or any custom rate.
| Net amount | £0 |
| VAT | £0 |
| Gross total | £0 |
How UK VAT works
Value Added Tax (VAT) is a consumption tax charged on most goods and services sold in the UK. The standard rate is 20%; a reduced 5% rate applies to things like domestic energy, children's car seats and some home improvements; a 0% rate covers most food, books and children's clothing. A small list of items is fully exempt (rents, education, financial services).
Adding VAT
To add 20% VAT to a net price, multiply by 1.20. £100 net becomes £120 gross.
Removing VAT (working backwards)
This is where people get tripped up. If a price already includes 20% VAT, you can't just take 20% off — you need to divide. £120 gross ÷ 1.20 = £100 net. The VAT element is £120 ÷ 6 = £20 (a useful shortcut: at 20% VAT, the VAT is exactly one-sixth of the gross).
Quick reference
| Net | +20% VAT | Gross |
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VAT registration thresholds
From 1 April 2024 the compulsory VAT registration threshold is £90,000 of taxable turnover in any rolling 12-month period. The de-registration threshold is £88,000. You can also register voluntarily if you're below it — useful if your customers are also VAT-registered (so they can reclaim) and you have lots of input VAT to recover.
Flat Rate Scheme
Small businesses with turnover under £150,000 can opt into the Flat Rate Scheme, charging customers 20% VAT but paying HMRC a lower percentage (typically 9.5%–14.5% depending on industry, with a 1% discount in year one). The trade-off is you can't reclaim input VAT on most purchases.
FAQs
What's the VAT on £100?
£20 at the 20% standard rate, making the total £120. At 5% reduced rate it's £5 (£105 total).
How do I work out VAT from a gross figure?
Divide the gross amount by 1.20 (for 20% VAT) to get the net. The difference between gross and net is the VAT. Example: £600 gross ÷ 1.20 = £500 net, so £100 VAT.
Are there things VAT doesn't apply to?
Yes — most food, books, children's clothes, rent, financial services, education and healthcare are either zero-rated or exempt. The HMRC website has the full list.