Global VAT Add/Remove Calculator

To add VAT to a price: VAT-inclusive price = Net price × (1 + VAT rate / 100). Example: net price £200 at 20% UK VAT = 200 × 1.20 = £240. VAT amount = £40. The standard UK rate is 20%. Reduced rates apply to certain items (5% on home energy, 0% on most food). EU rates vary by country (15-27%). For B2B invoices, always show both net and VAT separately, plus your VAT registration number. The calculator handles different rates and formats for the UK and EU markets.

To remove VAT, divide by (1 + VAT rate / 100). Example: gross price £240 at 20% VAT → net = 240 / 1.20 = £200. VAT amount = £40. Quick mental shortcut at 20%: divide by 6 to find VAT, then subtract. £240 / 6 = £40 VAT, net = £200. Many small businesses get this wrong by deducting 20% directly (240 − 48 = £192), which understates the net price. Always divide by (1 + rate), don't subtract the rate. The calculator handles this correctly for any VAT percentage.

VAT amount = Net price × (VAT rate / 100). VAT-inclusive price = Net price × (1 + VAT rate / 100). To extract VAT from a gross price: VAT = Gross × (rate / (100 + rate)). Example: £600 gross at 20% VAT. VAT = 600 × (20/120) = £100. Net = £500. The same formula structure works for any rate — just substitute. UK uses 20% standard, 5% reduced, 0% zero-rated. India uses GST instead of VAT, with similar mechanics. The calculator supports any rate you input.

VAT-inclusive price = Net price × (1 + VAT rate / 100). Example: net £150, VAT 20% → inclusive = 150 × 1.20 = £180. The "VAT-inclusive" label is mandatory for B2C invoices in many EU countries. Customers see one final price; the breakdown happens behind the scenes. Internally, accounting still records the net amount as revenue and the VAT as a liability owed to HMRC (or the equivalent tax authority). For B2B, invoices typically split net and VAT explicitly. The calculator generates both views — useful for invoice templates.

VAT-exclusive (or net) price = Gross price / (1 + VAT rate / 100). Example: gross £180 at 20% → exclusive = 180 / 1.20 = £150. This is the price before tax — what businesses record as actual revenue. For B2B sales, exclusive pricing is standard since the buyer claims back the input VAT. For consumer pricing, inclusive is the norm. Always be clear which version a quote refers to — confusion here is a common source of margin errors. The calculator shows both, ensuring you don't accidentally undercharge or overcharge.

Reverse VAT calculation extracts VAT from a gross (inclusive) price. Formula: VAT = Gross × (rate / (100 + rate)). For 20% VAT on £600 gross: VAT = 600 × (20/120) = £100. Net price = £500. For 5%: VAT = Gross × (5/105). For 18% (some EU rates): Gross × (18/118). This matters when you have a final price and need to file VAT returns. The output VAT you owe is the VAT portion of your total sales — which means reverse calculating from your gross figures. The calculator does this for all VAT rates.

VAT (Value Added Tax) is charged at every stage of production and distribution, with businesses reclaiming VAT paid on inputs. The end consumer effectively bears the full tax. Sales tax (used in the US) is charged only at the final sale to the consumer — single point. VAT is more complex but reduces tax cascading. UK VAT is 20% standard. US sales tax varies wildly — 0% (Oregon, Montana, NH, Delaware) to 9.5%+ (Tennessee with local). India uses GST, which works like VAT. For accounting, VAT requires more rigorous record-keeping; sales tax is simpler.