How to use the VAT calculator
- Choose Remove VAT or Add VAT. Remove VAT when you have a price that already includes VAT (the gross price) and want the price without it. Add VAT when you have a price before VAT (the net price).
- Type the price in pounds, such as 120 or 1,499.99.
- Pick the rate: 20%, 5%, 0%, or Other for any rate you need.
The net price, the VAT and the gross price update as you type, with the sum that produced them. Use Copy result to paste all three figures into an invoice, an email or a spreadsheet.
UK VAT rates
GOV.UK says simply: "The standard VAT rate is 20%". There are three rates:
| Rate | % | What it applies to (GOV.UK) |
|---|---|---|
| Standard | 20% | Most goods and services |
| Reduced | 5% | Some goods and services, for example children's car seats and home energy |
| Zero | 0% | For example most food and children's clothes |
Zero-rated is not the same as exempt. GOV.UK notes that "Some things are exempt from VAT", such as postage stamps. Which rate applies depends on what is being sold, so check GOV.UK's list of rates on different goods and services if you are unsure.
How to remove VAT from a price
To find the price before VAT, divide the gross price by 1 plus the rate:
- At 20%: net = gross ÷ 1.2
- At 5%: net = gross ÷ 1.05
- VAT = gross minus net
HMRC explains the same thing with the "VAT fraction". In its VAT guide (Notice 700), the fraction is worked out as "rate of tax divided by (100 + rate of tax)". At 20% that is 20/120, which is one-sixth, so the VAT inside any 20% price is the price divided by 6. At 5% it is 5/105, or 1/21.
HMRC's own example is a sale for £2.40 at 20%: "the amount of VAT is 40 pence". Here are a few more, worked out the same way:
| Gross price | Rate | Sum | Net | VAT |
|---|---|---|---|---|
| £2.40 | 20% | 2.40 ÷ 1.2 | £2.00 | £0.40 |
| £120.00 | 20% | 120 ÷ 1.2 | £100.00 | £20.00 |
| £100.00 | 20% | 100 ÷ 1.2 | £83.33 | £16.67 |
| £210.00 | 5% | 210 ÷ 1.05 | £200.00 | £10.00 |
The common mistake: taking 20% off
It is tempting to remove VAT by taking 20% off the gross price. That gives the wrong answer. Take a £120 price: 20% of £120 is £24, which would leave £96. But the VAT was 20% of the net price, £100, so it was only £20.
HMRC puts it plainly in its £2.40 example: "40 pence is not 20% of £2.40. It is one-sixth of £2.40." You can check any answer by adding the VAT back on: £96 plus 20% is £115.20, not £120. £100 plus 20% is £120 exactly. When you remove VAT, the calculator shows the wrong figure you would get by taking the rate off, so you can see the difference.
How to add VAT to a price
To add VAT, multiply the net price by 1 plus the rate: net × 1.2 at 20%, or net × 1.05 at 5%. The VAT on its own is net × 0.2 at 20%. For example, £350 plus VAT at 20% is £70 VAT and £420 in total. At the reduced rate of 5%, the same £350 has £17.50 VAT and comes to £367.50.
Rounding to the nearest penny
VAT often comes to a fraction of a penny. The calculator works in whole pence and rounds the VAT to the nearest penny, the method HMRC describes in its VAT Traders' Records Manual: if the VAT "comes to less than 0.5 of one penny, it should be rounded down", and if it "comes to 0.5 of one penny or more, it should be rounded up". When you remove VAT, the net price is then the gross minus the rounded VAT, so the three figures always add up.
So £100 including 20% VAT has £16.666... of VAT, which becomes £16.67, leaving £83.33. Adding 20% to £83.33 gives £16.666 of VAT, which also rounds to £16.67, and £100.00 in total.
Invoices with many lines can differ from a single sum by a penny or two, because VAT may be worked out line by line or on the total. HMRC's VAT guide (Notice 700, section 17.5) sets out the rounding methods a business may use on its invoices, and adds that "the final total amount of VAT payable may be rounded down to the nearest whole penny". So a correct invoice can show a penny less VAT than this calculator. Follow Notice 700, or your accounting software, for the VAT you charge.
Questions and answers
How do I take VAT off a price?
Divide the price by 1.2 for 20% VAT, or by 1.05 for 5%. £120 ÷ 1.2 = £100, so the VAT was £20. Do not take 20% off the price: that gives £96, which is too little.
How much VAT is in a price at 20%?
One-sixth of it. Divide the price including VAT by 6. A £60 price includes £10 of VAT. HMRC calls this the VAT fraction.
What is the VAT rate in the UK?
The standard rate is 20%. There is a reduced rate of 5% for some goods and services, such as home energy, and a zero rate of 0% for things such as most food and children's clothes.
Can I use a different rate, such as an old rate or another country's?
Yes. Choose Other and type the rate. The same sums work for any percentage. The standard UK rate was 17.5% before it rose to 20% on 4 January 2011.
Why is my invoice a penny different?
VAT is often a fraction of a penny. This calculator rounds the VAT on the whole amount to the nearest penny. An invoice that rounds each line separately can come to a penny or two more or less, and HMRC also allows the final VAT total on an invoice to be rounded down to the nearest whole penny.
Sources
Checked on 7 October 2026. If a rule has changed, please tell us.