VAT Calculator

A VAT calculator works in both directions: adding tax to a net price, or working backwards from a VAT-inclusive price to find the net and the tax. Enter an amount, pick a rate, and you get all three figures. The reverse direction is where most manual calculations go wrong. Everything runs in your browser.

Two modes cover every VAT job

Add VAT takes a net price and applies the rate, which is what you need when quoting or raising an invoice. Remove VAT takes a tax-inclusive figure and works back to the net and the tax, which is what you need when claiming an expense, checking a receipt, or recording a purchase. Presets cover the UK standard 20% and reduced 5%, along with common EU, UAE, South Africa and India GST rates, and any custom rate can be typed in directly.

The reverse-VAT trap

This is the mistake worth understanding properly, because it appears in spreadsheets everywhere. A £120 receipt at 20% VAT does not contain £24 of VAT. The 20% was charged on the net price, not the gross, so the correct operation is dividing by 1.20: net £100, VAT £20. Subtracting 20% from the gross gives £96 and £24, both wrong.

The error grows with the rate. At Ireland's 23%, the correct VAT inside a €123 gross price is €23, while subtracting 23% of €123 gives €28.29 — an overstatement of about 23% of the reclaimable amount. That is exactly the kind of discrepancy that gets an expense claim bounced or a return queried.

Worked examples at 20%

A useful shortcut falls out of the arithmetic: at 20%, the VAT inside a gross price is always exactlyone sixth of it, because dividing by 1.2 and subtracting is the same as multiplying by 1/6. So £120 gross contains £20 of VAT, and £45.60 contains £7.60. That trick only works at 20% — at 5% the fraction is one twenty-first.

Zero-rated is not the same as exempt

Two categories look identical to a customer and behave differently for a business. Zero-ratedsupplies are taxable at 0%, so they count as taxable turnover and you can still reclaim the VAT on costs incurred to make them. Exempt supplies sit outside the VAT system, do not count toward the registration threshold in the same way, and input VAT attributable to them generally cannot be reclaimed. Getting these the wrong way round affects both your registration position and your reclaim, which is why it is worth checking rather than assuming.

Rates change, so verify before you file

The presets reflect widely published standard rates, but reduced rates, sector-specific exceptions and temporary changes are common, and several countries adjusted rates during and after the pandemic. Confirm the applicable rate with your own tax authority before invoicing or filing — gov.uk for the UK. This tool does the arithmetic; it cannot tell you which rate your particular supply attracts, and that determination is the part that carries real consequences.

Quick checks before sending an invoice

1. State all three figures. A VAT-registered client needs net, VAT and gross shown separately.
2. Apply VAT per line, not once to the total, if your accounting software does the same.
3. Check the direction. If the number you were given already includes tax, you are removing, not adding.
4. Include your registration number where the rules require it; the arithmetic being right does not make the invoice valid.
5. Apply any discount before VAT, so tax is charged on what the customer actually pays.

Related calculators

Building an invoice around these figures? The invoice generator lays out net, discount, VAT and total correctly and prints to PDF. For Indian rates specifically, theGST calculator handles the slabs, and theincome tax calculator covers the other side of the return. For everyday percentage work, the tip calculator is the simpler tool.