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VAT calculator

Add or remove VAT to calculate net, VAT and gross amounts.

Add VAT Remove VAT

Amount

VAT rate

Estimate only. Check the correct VAT treatment and rate for your goods, services and business circumstances.

VAT amount

£0

Net amount£0
Gross amount£0
VAT rate20%

What your result means

Add VAT to an amount before tax, or extract VAT from a price that already includes it. The tool calculates the arithmetic; it does not decide whether VAT should be charged.

Compare scenarios by changing one input at a time. The glossary explains the technical words used on this page.

VAT amount: The difference between the gross and net amounts at the rate entered.
Net amount: The price before VAT. In Add VAT mode this is the amount you enter.
Gross amount: The price including VAT. In Remove VAT mode this is the amount you enter.
VAT rate: The percentage used in the calculation, not a confirmation that the correct tax treatment was selected.

Removing 20% VAT is not the same as subtracting 20% of the gross price. A £120 VAT-inclusive price at 20% contains £20 VAT and £100 net, not £24 VAT.

Methodology: how the calculation works

Choose the mode according to whether the amount already includes VAT. Each calculation applies one rate to one amount.

Convert the VAT percentage to a decimal: 20% becomes 0.20.
To add VAT, multiply the net amount by (1 + rate) to obtain the gross amount.
To remove VAT, divide the gross amount by (1 + rate) to recover the net amount.
Subtract net from gross for the VAT amount. Display all three money values to two decimal places.

See the calculation formula

Add: gross = net × (1 + r)
Remove: net = gross ÷ (1 + r)
VAT = gross − net

r is the VAT percentage divided by 100. At 20%, 1 + r = 1.20. At 5%, it is 1.05. At 0%, net and gross are equal and the calculated VAT amount is zero.

The assumptions behind your estimate

One VAT rate applies to the entire amount entered. Split mixed-rate invoices into separate amounts before calculating.
The selected mode is correct: Add expects a VAT-exclusive amount; Remove expects a VAT-inclusive amount.
Values are rounded to the nearest penny for display. Invoice-level or line-by-line rounding can differ from applying a rate once to a combined amount.
The default 20% is the standard UK rate, not a claim that every transaction uses it. GOV.UK rates were checked for this draft on 5 September 2026.

Two simple worked examples

These examples work forwards and backwards through the same 20% VAT calculation. They are arithmetic illustrations, not a ruling on any particular sale.

Worked example

Add VAT to £100

Add VAT to £100.00 · 20% VAT

£20.00

calculated VAT amount

Net amount: £100.00
Gross amount: £120.00
VAT rate: 20%

Worked example

Remove VAT from £120

Remove VAT from £120.00 · 20% VAT

£20.00

calculated VAT amount

Net amount: £100.00
Gross amount: £120.00
VAT rate: 20%

A closer look: a mixed-rate invoice

Suppose an invoice contains the following separate lines and you have already confirmed their tax treatment. Use the tool once for each line. The zero-rated line is assumed to be a taxable supply at 0%, not an exempt supply.

On a small screen, swipe the table sideways to see every figure.

VAT: illustrative scenarios
Scenario	Inputs and assumptions	Net amount	VAT amount	Gross amount	VAT rate
A · Net line at 20%	Add VAT to £1,000.00 · 20% VAT	£1,000.00	£200.00	£1,200.00	20%
B · Net line at 5%	Add VAT to £200.00 · 5% VAT	£200.00	£10.00	£210.00	5%
C · Net line at 0%	Add VAT to £100.00 · 0% VAT	£100.00	£0.00	£100.00	0%
D · Check A backwards	Remove VAT from £1,200.00 · 20% VAT	£1,000.00	£200.00	£1,200.00	20%

Add A, B and C only: the net invoice total is £1,300.00, VAT is £210.00 and gross is £1,510.00. D repeats A in reverse and is not another invoice line. Applying 20% to the full £1,300 would incorrectly ignore the different rates in this example.

Examples use the stated assumptions and the existing calculator’s rounding. They are illustrations, not product offers, personalised recommendations or guarantees.

What the estimate does not include

Deciding whether a business must register, whether a supply is taxable or which rate or exemption applies.
VAT returns, reclaim eligibility, special schemes, imports, exports and any transaction requiring more than one simple rate calculation.
An invoice’s legal requirements or a tax filing. Check the applicable guidance and your records for those purposes.

VAT glossary: the words explained

Plain-English definitions of the finance, calculation and technical terms used on this page. Dotted links take you directly to the relevant definition.

Broker / credit broker / broker fee: A business that introduces customers to finance providers or helps arrange finance, rather than lending the money itself. A broker fee is a charge for that service.
Credit / finance / borrowing: Money made available to borrow and repay later, usually with interest or charges.
Decimal / percentage: A percentage is an amount per hundred. Dividing a percentage by 100 gives the decimal used in the formula.
Estimate / illustration / projection: A result based on stated inputs and assumptions, not a promise of what will happen or a provider’s offer.
Exempt / outside the scope of VAT: Different tax categories where VAT is not charged in the ordinary way. Neither is the same as a taxable supply at a 0% rate.
Financial Conduct Authority (FCA) / authorised and regulated: The UK financial-services regulator named in the site footer. Authorisation gives a firm permission for specified activities; regulation means it must follow the applicable rules.
Gross / VAT-inclusive: The amount including VAT: net amount plus VAT.
HMRC (HM Revenue & Customs): The UK government department responsible for collecting and administering taxes including VAT and Stamp Duty Land Tax.
Invoice / line item: A document setting out a charge, or an individual entry on it. Different line items can have different tax treatment.
Lender / provider: The organisation supplying a loan or financial product and setting its terms.
Methodology: The calculation method, steps and assumptions behind an estimate.
Net / VAT-exclusive: The amount before VAT is added. In Remove VAT mode it is recovered from the VAT-inclusive amount.
Rounding / unrounded: Shortening a number for display. An unrounded calculation keeps the more precise value when working out totals.
Standard / reduced / zero rate: Different VAT rates. Standard is 20%, reduced is 5% and zero is 0% under the rules checked for this draft; which applies depends on the supply.
Supply / taxable supply: A sale or provision of goods or services. A taxable supply can be subject to standard, reduced or zero-rate VAT.
Tax / tax treatment: An amount that may be payable to government and the rules deciding how it applies. The applicable rules depend on the transaction and circumstances.
VAT (Value Added Tax): A tax charged on many goods and services. The applicable treatment and rate must be established separately from this calculation.
VAT registration / VAT return / reclaim: Registration brings a business into the VAT system; a return reports VAT information; reclaiming means recovering qualifying VAT paid under the rules. This calculator does none of these.

Frequently asked questions

Why do I divide by 1.2 to remove 20% VAT?

The gross price represents 120% of the net price. Dividing by 1.2 returns the original 100%. Taking off 20% of gross uses the wrong starting amount.

Is VAT always 20%?

No. The standard rate is 20%, but reduced and zero rates and other treatments can apply. Check the relevant GOV.UK guidance for the supply.

Does entering 0% mean the item is exempt?

No. The arithmetic gives zero VAT, but zero-rated and exempt supplies are different tax categories. The calculator does not determine the category.

Can I calculate a whole mixed-rate invoice in one go?

Not at one rate. Separate the amounts by their applicable rates, calculate each, then combine the results.

Can I use the result as a VAT return?

No. It is a calculation aid, not a tax return, registration check or decision about VAT recovery.

Explore your next step

Confirm the applicable VAT treatment first. Then use the correct add/remove mode and keep the calculation with the underlying invoice information.

About this explanation. The methodology describes the existing calculator. Worked examples were checked against its calculation and an independent calculation. This is general information, not a professional recommendation or formal compliance approval.

Further reading from MoneyHelper and government sources: