Use this UK VAT Calculator to Add VAT, Remove VAT, or break down VAT amounts instantly – using the official UK VAT rates of 20%, 5%, and 0%
As of the 2025/26 tax year, the standard VAT rate in the UK remains 20%, and there have been no confirmed increases from HMRC. The 20% rate applies to the majority of goods and services, making it the default VAT percentage for most businesses. The government periodically reviews VAT rates, but because VAT contributes heavily to the national budget, major changes are rare.
Value Added Tax (VAT) is applied to the majority of goods and services across the United Kingdom, and understanding how to calculate it accurately is essential for consumers, freelancers, shop owners, eCommerce sellers, and VAT-registered businesses. This VAT Calculator for the UK allows you to add VAT, remove VAT, or break down VAT amounts instantly—using the official UK VAT rates of 20%, 5%, and 0%.
| Rate | Description | Examples of Goods/Services |
|---|---|---|
| 20% | Standard Rate | Most goods and services (clothing, electronics, fuel, restaurant meals, hotel accommodation, mobile contracts, pay TV, furniture, hairdressing) |
| 5% | Reduced Rate | Children’s car seats, home energy-saving materials, insulation, residential caravans (no engine), some social housing, certain medical equipment for disabled people |
| 0% | Zero Rate | Most food, children’s clothes, books, newspapers, some medical goods, exports, international services |
Using the VAT Calculator UK is straightforward and does not require any registration or technical knowledge. If you want to add VAT to a price, you simply enter the net amount—the price before any tax—and choose the applicable rate. The most common rate in the UK is the standard 20% rate, but the calculator also supports the reduced 5% rate and the zero 0% rate used for specific items. Once you input your amount, the tool instantly displays the VAT added and the final total price including VAT. For example, if you enter £100 at the 20% rate, the calculator will immediately show a VAT amount of £20 and a total price of £120.
You can also use the calculator to remove VAT from a price that already includes tax. This feature is especially helpful when reviewing receipts, preparing invoices, or calculating the net price for accounting purposes. If a product costs £120 including 20% VAT, entering £120 and selecting the same VAT rate will show the net price as £100 and the VAT portion as £20. The calculator uses accurate VAT-extraction formulas that ensure the results match HMRC standards. Also you can use our free and accurate Tax Calculator.
Value Added Tax (VAT) is a consumption tax applied to most goods and services sold within the UK. Introduced in 1973 when the UK joined the European Economic Community, VAT replaced the previous Purchase Tax system to create a more structured and fairer tax model.
The concept behind VAT is simple:
Tax is added at every stage of production and distribution, but ultimately paid by the final consumer. Businesses act as VAT collectors for HMRC and reclaim VAT on qualifying purchases, ensuring the system remains balanced.
For consumers, VAT is typically included in the final price of goods and services, which is why most prices displayed in shops or online already include VAT. For businesses, however, VAT is something that must be recorded and declared properly. Businesses charge VAT on sales (known as output VAT), and they can also reclaim the VAT they pay on business expenses (known as input VAT). This system ensures that VAT is ultimately paid by the end consumer, not by the businesses operating within the supply chain. Read More About VAT Tax & Rate on Wikipedia.
VAT registration is required once your business turnover exceeds the official threshold set by HMRC. The current threshold is £90,000 in rolling 12-month revenue. If you expect to cross this amount within 30 days, you must register immediately. Businesses that do not track this properly may face penalties.
Although registration is mandatory at the threshold, many small businesses choose to register voluntarily even if their turnover is lower. Voluntary registration allows a business to reclaim VAT on purchases and claim input VAT credits on equipment, materials, and operational expenses. It can also increase business credibility, especially when dealing with clients who themselves are VAT-registered.
Sole traders, freelancers, limited companies, partnerships, and online sellers operating platforms such as Amazon, Etsy, Shopify, or WooCommerce may all be required to register for VAT depending on their revenue and operations. Once registered, businesses must charge VAT on their services and file VAT returns using Making Tax Digital (MTD) compatible software.
The calculator makes VAT calculations instant, but knowing the formulas can help you verify results or manually check invoices. To add VAT at the 20% rate, multiply the net price by 1.20. For example, £50 becomes £60 after adding 20% VAT. For the reduced rate of 5%, multiply the net amount by 1.05.
Removing VAT is slightly more complex because tax is already included in the total price. To extract VAT from a price that includes 20% tax, divide the amount by 1.20. For example, £120 including VAT becomes £100 net. The VAT amount is then the difference between the total price and the net price. The same logic applies for the 5% rate using the divider 1.05.
Check out: Income Tax Calculator for UK
To use a VAT Calculator for the UK effectively, it helps to understand the core formulas used for adding, removing, and extracting VAT:
When you want to add VAT to a price:
VAT-exclusive amount × 1.20 = VAT-inclusive amount
VAT amount = VAT-exclusive amount × 0.20
When you want to find the VAT portion inside a VAT-inclusive price:
VAT-inclusive amount × 20 ÷ 120 = VAT amount
(You can also use: VAT-inclusive amount ÷ 6 = VAT amount)
To convert a VAT-inclusive amount back to VAT-exclusive:
VAT-inclusive amount ÷ 1.20 = VAT-exclusive amount
| Scenario | Formula | Example |
|---|---|---|
| Add VAT to Net Price | Net Price × VAT Rate | £100 × 20% = £20 VAT |
| Total Price (Including VAT) | Net Price + VAT | £100 + £20 = £120 |
| Remove VAT from Gross Price | Gross ÷ (1 + VAT Rate) | £120 ÷ 1.20 = £100 |
| VAT Amount from Gross | Gross − (Gross ÷ 1.20) | £120 − £100 = £20 |
VAT refunds, also known as VAT reclaims, allow VAT-registered businesses to recover VAT paid on business-related expenses. This includes purchases such as tools, equipment, stock, travel costs, office supplies, software, and other items used for business purposes. When a business files its VAT return, it subtracts the input VAT it has paid from the output VAT it has collected from customers. If the input VAT is higher, the business can claim a refund from HMRC.
A Reverse VAT Calculator is a financial tool used to determine the original price of a product or service before VAT was added. Instead of calculating how much VAT to charge on top of a price, it works backward—removing VAT from a VAT-inclusive amount to reveal the net cost and the tax portion separately.
This tool is widely used by business owners, accountants, freelancers, and online sellers who receive VAT-inclusive invoices and need to extract the net price for bookkeeping, reporting, or tax submissions. A reverse VAT calculator ensures accuracy because manually removing VAT using simple division often leads to errors.
For example, if an item costs £120 including 20% VAT, a reverse VAT calculator quickly breaks it down to show:
Net price (before VAT): £100
VAT amount: £20
Whether you work in retail, construction, eCommerce, hospitality, or imports, a reverse VAT calculator helps maintain accurate financial records and eliminates calculation mistakes.
VATCalculatorUK.net is a practical online tool designed to help individuals, small businesses, freelancers, and e-commerce sellers calculate VAT accurately and quickly. The platform supports both VAT-inclusive and VAT-exclusive calculations, making it useful for pricing products, issuing invoices, or checking VAT on expenses. It follows the official UK VAT rates set by HMRC, including the standard rate of 20%, the reduced rate of 5% for specific goods and services, and the 0% rate for zero-rated items.
The calculator is especially helpful for users who want clear, error-free VAT calculations without needing formulas or accounting knowledge. Each calculation is instant, allowing users to confirm tax amounts before submitting VAT returns or adjusting financial records.
You calculate VAT by multiplying the net amount by the VAT rate, usually 20%. For example: Net × 0.20 = VAT and Net × 1.20 = VAT-inclusive total.
VAT is calculated by applying the VAT percentage to the VAT-exclusive price. If you already have the VAT-inclusive price, divide it by 1.20 to remove VAT.
To extract VAT from a gross (VAT-inclusive) price, divide the total by 1.20 to find the net amount. Subtract net from gross to get the VAT value.
Simply use the formula: Gross ÷ 1.20 = Net, then Gross – Net = VAT amount. This works for any 20% VAT calculation.
Reverse VAT by taking the VAT-inclusive amount and dividing it by 1.20. This removes VAT and gives you the original VAT-exclusive price.
To get a VAT-inclusive total, multiply the net amount by 1.20. The extra 20% represents the VAT added.
The UK standard rate is 20%, so VAT calculations use:
Net × 0.20 = VAT
Net × 1.20 = Gross
Gross ÷ 1.20 = Net
Use simple formulas like:
Add VAT: =A1*1.20
VAT amount: =A1*0.20
Remove VAT: =A1/1.20