VAT calculator

Adding VAT to a net price:

VAT = net × rate / 100, and gross = net + VAT, or simply gross = net × (1 + rate / 100).

Removing VAT from a gross price:

net = gross / (1 + rate / 100), and VAT = gross − net.

The VAT included in a gross price is rate / (100 + rate) of the total. That's the VAT fraction: at 20% it is 20/120 = 1/6, so the VAT in any VAT-inclusive UK price at the standard rate is one sixth of it. HMRC uses this fraction in its guidance, and the calculator shows it for any rate.

The most common mistake is to remove VAT by taking 20% off the gross price. 20% of £120 is £24, but the VAT in £120 is only £20, because the 20% was charged on the net £100.

Adding VAT: a net price of £100 at 20%:

1. VAT: 100 × 20 / 100 = £20.
2. Gross: 100 + 20 = £120.

Removing VAT: a VAT-inclusive price of £120:

1. Net: 120 / 1.2 = £100.
2. VAT: 120 − 100 = £20, or 120 × 1/6.

The UK also has a 5% reduced rate (for example on domestic energy and some children's car seats) and a 0% zero rate (most food, children's clothing, books). Which rate applies depends on the goods or service.

Removing Dutch VAT: a price of €59.99 including 21% VAT:

• Net: 59.99 / 1.21 = €49.58.
• VAT: €10.41.

Adding German VAT: a net invoice of €250 at 19%:

• VAT: €47.50.
• Gross: €297.50.

Standard rates in the EU range from the high teens to the mid twenties. The country list in the calculator fills in each country's standard rate as published by the European Commission; reduced rates differ by product and country, so type those in yourself.

Each EU country sets its own rates within limits set by the EU VAT Directive: a standard rate of at least 15%, and up to two reduced rates for goods and services listed in the directive, plus some special rates. The UK sets its own rates and rules, published by HMRC.

• Goods and services: the rate depends on what is sold. Food, books, medicines, passenger transport and accommodation often have reduced rates; most other things are at the standard rate.
• Selling to consumers in other EU countries: for many distance sales and digital services, VAT is charged at the rate of the customer's country, typically reported through the One-Stop Shop (OSS).
• Business to business: cross-border B2B services in the EU are often invoiced without VAT under the reverse charge, and the customer accounts for it.

Rates do change. Before you invoice, check the current rate on the European Commission or HMRC website.

The calculator rounds to two decimal places at the end. On invoices, VAT rules may let you round per line or on the total; HMRC, for example, allows either approach as long as it is applied consistently, and EU countries have their own rules. Totals on a multi-line invoice can therefore differ from a single calculation by a cent or a penny. For VAT returns, use the figures from your accounting records.

VAT is collected at every stage of the supply chain: each business charges VAT on its sales and reclaims the VAT it paid on its purchases, so the tax is ultimately borne by the final consumer. Consumer prices in the UK and EU must normally be displayed including VAT.

US sales tax is charged once, at the final sale, and is usually added at the checkout on top of the shelf price. If you need a US rate, use the sales tax calculator, which works the same way in both directions.

• Quick UK check: VAT in a 20% gross price is one sixth; the net is the gross divided by 1.2.
• Custom rates: choose "Other rate" and type any rate, including reduced rates or rates outside the EU.
• Share: the amount, direction and rate are saved in the link, so the Share button sends the exact calculation.

This is a calculation aid, not tax advice. For VAT registration, returns or complex cases, check HMRC or your national tax authority, or ask an accountant.