Free UK VAT calculator for 2026. Add VAT to a net price or remove VAT from a gross total at the standard 20%, reduced 5% or zero rate. Instantly see net, VAT and gross — built for freelancers, contractors and small businesses.
Current UK VAT rates · Reverse VAT calculator · What is VAT?
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VAT is worked out on the net price (the amount before tax). To add VAT to a net price you multiply by one plus the rate; to remove VAT from a gross (tax-inclusive) price you divide by the same figure. At the standard UK rate of 20% that means multiplying or dividing by 1.20.
Common mistake: don’t subtract 20% from a gross price to remove VAT. £600 minus 20% is £480, which is wrong. VAT at 20% is one sixth of the gross, so £600 ÷ 1.20 = £500 is correct.
There are four VAT categories in the UK. Most goods and services are charged at the standard 20% rate, but some qualify for a reduced or zero rate, and a few are exempt from VAT altogether. For the bigger picture, see our overview of what VAT is and how it works.
| Rate | % | Applies to |
|---|---|---|
| Standard rate | 20% | Most goods and services |
| Reduced rate | 5% | Domestic energy, child car seats, some building work |
| Zero rate | 0% | Most food, children's clothes, books, newspapers |
| Exempt | N/A | Insurance, finance, education, health services |
Zero-rated is not the same as exempt. Zero-rated supplies are still inside the VAT system, so a VAT-registered business charges 0% but can reclaim VAT on related costs. Exempt supplies are outside VAT entirely, so the VAT on associated costs usually cannot be reclaimed.
You must register for VAT if your taxable turnover exceeds £90,000 (the current UK threshold) in any rolling 12-month period — not a calendar or tax year, but the most recent 12 months at any point in time. You also need to register if you expect to pass the threshold within the next 30 days alone. See what VAT is, how to add VAT, or use the reverse VAT calculator to remove VAT from a gross price.
Many businesses register voluntarily before they have to. If you sell mainly to other VAT-registered businesses (B2B), registering lets you reclaim VAT on your costs without putting customers off, since they can reclaim the VAT you charge. For B2C sales, where the customer can’t reclaim, the 20% uplift needs more thought.
If your turnover is under £150,000 you may be able to simplify your VAT accounting with the Flat Rate VAT Scheme, where you pay a fixed percentage of your gross turnover instead of tracking VAT on every transaction.
To add VAT, multiply the net (ex-VAT) amount by the VAT rate as a decimal and add it to the net. At the standard UK rate of 20%, multiply the net by 1.20 to get the gross. To remove VAT from a gross price, divide by 1.20 instead. This calculator does both operations for you in one click.
Enter the net amount (excluding VAT), select the rate — Standard 20%, Reduced 5% or Zero 0% — and press "Add VAT". The calculator multiplies the net by 1 + rate (e.g. net × 1.20 at 20%) and shows the VAT amount and gross (VAT-inclusive) total.
Enter the gross (VAT-inclusive) amount and press "Remove VAT". The calculator divides the gross by 1 + rate (e.g. gross ÷ 1.20 at 20%) to recover the net figure. Do not simply subtract 20% of the gross — that gives the wrong answer because VAT is calculated on the net, not the gross.
The standard UK VAT rate is 20% and has been since 4 January 2011. A reduced rate of 5% applies to certain goods and services such as domestic energy, child car seats and some building work. Some items are zero-rated (0%) including most food, children's clothes and books. Check HMRC for the full list.
From April 2024 the UK VAT registration threshold is £90,000. If your taxable turnover exceeds this amount in any rolling 12-month period you must register for VAT with HMRC. Once registered, you charge VAT on your sales and can reclaim VAT on eligible business purchases.
A reverse VAT calculation extracts the VAT from a gross (VAT-inclusive) price. At 20%, the VAT element is always one sixth of the gross — or equivalently, gross ÷ 1.20 gives the net, and gross minus net gives the VAT. Use the "Remove VAT" button on this calculator to do a reverse VAT calculation instantly.
Net is the price before VAT is added (excluding VAT). Gross is the total price after VAT has been added (including VAT). For example, if a product costs £100 net and VAT is 20%, the gross price is £120 and the VAT amount is £20.
20% of a gross price is not the same as the VAT embedded in that price. VAT at 20% is calculated on the net amount, which makes it one sixth of the gross — not one fifth. Dividing the gross by 1.20 recovers the correct net; subtracting 20% of the gross overstates the VAT and understates the net.
Zero-rated supplies are within the VAT system — you charge 0% but can normally reclaim input VAT on related business costs. Exempt supplies are outside VAT, so you usually cannot reclaim the VAT on costs connected to those exempt activities. The distinction matters for VAT-registered businesses.
List the net amount for each line item, calculate VAT for each at the correct rate (20%, 5% or 0%), then show totals for net, VAT and gross. A valid UK VAT invoice must include your VAT registration number, the date, invoice number, your details, the customer's details, and a line-by-line VAT breakdown.
Yes. Enter your figure, choose the VAT rate that applies, and press Add VAT or Remove VAT. Use the net, VAT and gross figures on quotes, invoices, expense reports or bookkeeping. Always confirm the correct VAT rate for your supply with HMRC or your accountant — this tool handles the arithmetic.
The flat rate scheme is a simplified VAT scheme for small businesses with taxable turnover of £150,000 or less (excluding VAT). Instead of calculating VAT on every purchase and sale, you pay a fixed percentage of your gross turnover to HMRC. The percentage varies by industry — for example, 14.5% for computer and IT consultancy. You cannot reclaim VAT on purchases under this scheme (except capital assets over £2,000).
VAT - or Value Added Tax - is charged by businesses at the point of sale of goods and services sold in the UK and the Isle of Man. Basically it is a tax on business transactions. Value Added Tax was introduced in 1973 as a replacement for Purchase Tax and Selective Employment Tax, as a condition of UK entry into the European Economic Community.
The reduction in the standard rate of VAT from 17.5% to 15% was prompted by the recent financial turmoil in the global financial system in 2008 and increased to 20% in January 2011.
The Chancellor stated that the temporary reduction would last for 13 months before returning to 17.5 per cent in January 2010.
The Chancellor stated in his 2008 Pre-Budget report that "This temporary reduction is the equivalent of the Government giving back some 12 and a half billion pounds to consumers to boost the economy."
We will be launching a range of guides and articles to cover a range of VAT related issues over the coming weeks and months. If you would like any information regarding VAT or any issues surrounding Value Added or any other Tax then do let us know.