VAT Calculator
Add VAT to a net price, or work backwards from a gross price to find the tax it already contains.
Runs entirely in your browser. Nothing you enter is uploaded.
Written and maintained by ReadoutKit / Takashi Yamazaki
How this works
Two directions, one of which people get wrong
Value added tax arithmetic is a single multiplication, and yet it is one of the most reliably miscalculated numbers in small business bookkeeping. The reason is that the calculation is not symmetric. Adding tax and removing tax feel like mirror images, so people reach for the mirror-image operation — and it is the wrong one.
Going forwards is easy. Take the net price, multiply by one plus the rate. A £100 service at 20% becomes £120. Going backwards is where it breaks. Faced with £120 including VAT, the instinctive move is to take 20% off, which gives £96. The correct answer is £100, and you only get there by dividing: 120 ÷ 1.20. The percentage was applied to £100, not to £120, so undoing it means dividing by the factor that was used, not subtracting the same percentage from a larger base.
This tool makes the direction an explicit choice rather than something you infer from which box you filled in, because the error is silent. Both answers look plausible on an invoice, and nothing downstream flags it.
Why the tax is never the rate you quoted
A second confusion follows from the same asymmetry. If you charge 20% VAT, the tax is not 20% of the money that arrives in your account. It is 20% of the price before tax, which works out at one sixth — 16.67% — of the total. At a 10% rate the tax is 9.09% of the gross. At 23% it is 18.70%.
This matters when you are setting aside money rather than filing a return. Someone reserving 20% of their gross takings at a 20% rate is over-reserving by a fifth; someone who reasons the other way and reserves too little is short at filing time. The readout shows the share of gross next to the rate so the two numbers sit side by side and cannot be quietly swapped.
What a gross price of 1,000 contains, rate by rate
The gross is held fixed and only the rate moves. That is the direction the work usually runs in: the figure you already have is the one on the receipt, not the one before tax.
| Rate | Net price | VAT | Share of gross |
|---|---|---|---|
| 5.0% | £952 | £48 | 4.8% |
| 8.0% | £926 | £74 | 7.4% |
| 9.0% | £917 | £83 | 8.3% |
| 10.0% | £909 | £91 | 9.1% |
| 15.0% | £870 | £130 | 13.0% |
| 19.0% | £840 | £160 | 16.0% |
| 20.0% | £833 | £167 | 16.7% |
| 21.0% | £826 | £174 | 17.4% |
| 23.0% | £813 | £187 | 18.7% |
| 25.0% | £800 | £200 | 20.0% |
The right-hand column is the figure from the previous section — always smaller than the headline rate. A 20% rate is 16.67% of the gross; a 10% rate is 9.09%. The two numbers move apart as the rate climbs, and at 25% they differ by five percentage points. When you set money aside out of takings, the column on the right is the one to use.
Subtracting the rate costs you the rate, squared
Here is the mistake from the opening section priced out. Same gross of 1,000, divided back correctly on one side and with the rate simply subtracted on the other.
| Rate | Correct net | Rate subtracted | Gap | Error |
|---|---|---|---|---|
| 5.0% | £952 | £950 | £2 | 0.2% |
| 8.0% | £926 | £920 | £6 | 0.6% |
| 9.0% | £917 | £910 | £7 | 0.8% |
| 10.0% | £909 | £900 | £9 | 1.0% |
| 15.0% | £870 | £850 | £20 | 2.3% |
| 19.0% | £840 | £810 | £30 | 3.6% |
| 20.0% | £833 | £800 | £33 | 4.0% |
| 21.0% | £826 | £790 | £36 | 4.4% |
| 23.0% | £813 | £770 | £43 | 5.3% |
| 25.0% | £800 | £750 | £50 | 6.3% |
Read the last column downwards. The table rounds to one decimal place, but the exact values are 1.00% at a 10% rate, 4.00% at 20% and 6.25% at 25%: the error is the rate squared, exactly. The correct net is G ÷ (1 + r) and the mistaken figure is G × (1 − r), so the gap between them is G × r² ÷ (1 + r). Divide by the correct net and the (1 + r) cancels out, leaving r² on its own.
The practical consequence is that this error hides at low rates and bites at high ones. At Japan’s reduced 8% it is 0.64% — six pounds in a thousand, close enough to rounding noise to survive a check. The identical mistake at Ireland’s 23% is 5.29%, or £43 in a thousand, repeated on every invoice that went through the same spreadsheet.
Rates are a starting point, not an answer
The country presets fill in a standard rate to save typing. They are not a ruling on what you should charge. Three things they cannot know:
Which rate applies to what you sell. Most systems operate reduced rates alongside the standard one, and the categories are specific rather than intuitive. The distinction between zero-rated and exempt is sharper still: both mean no tax on the sale, but zero-rating usually preserves your ability to reclaim input tax while exemption removes it. That difference changes your net position substantially and is not visible in the price.
Where the supply takes place. Cross-border rules decide whose VAT applies and whether the customer accounts for it instead of you. Digital services to consumers in the EU are generally taxed where the customer is; business-to-business supplies often shift the obligation to the buyer entirely. A single national rate cannot express any of this.
Whether you should be registered at all. Registration thresholds, voluntary registration and flat-rate schemes all change what you charge and what you keep. A calculator that only knows a percentage cannot advise on any of them.
Rates also move. They were checked on the date shown on screen, but tax law changes on political timetables, occasionally mid-year and occasionally as a temporary measure that later reverses. The rate field stays editable so a stale preset never becomes a hard constraint.
Rounding, and why the figures here carry full precision
Dividing by 1.1 or 1.2 rarely lands on a whole unit of currency. Tax authorities have rules about when to round and at which level — per line, per invoice, or per tax point — and they differ between jurisdictions. This calculator holds full precision internally and rounds only for display, so what you see is the underlying figure rather than a rounded value that has been rounded again. When you transfer a number to an invoice, apply your jurisdiction's rounding rule at that point, once.
For a quick check on any result, the relationship to verify is that net plus tax equals gross, and that tax divided by net equals the rate. If both hold, the arithmetic is right, whichever direction you came from.
Common questions
- Why can I not just subtract 20% to remove VAT?
- Because the 20% was added to a smaller number than the one you are now holding. If the net price is £100, VAT of £20 makes the gross £120. Subtracting 20% from £120 gives £96, not £100 — you have taken a fifth of the larger figure instead of undoing a fifth of the smaller one. The only correct way back is division: £120 ÷ 1.20 = £100. The gap widens as the rate rises, which is why the mistake is worth £3.83 on a £23 Irish invoice but only £0.24 on a Canadian one.
- What is the VAT on a £1,000 gross price?
- At the UK standard rate of 20%, the net price is £833.33 and the VAT is £166.67 — not £200, which is what you get by taking 20% of the gross. At 5% the split is £952.38 and £47.62; at 23%, £813.01 and £186.99. The table in this article works through ten rates from 5% to 25%, all computed by the same function as the calculator above.
- How far out am I if I just subtract the rate from the gross price?
- The error, as a share of the correct net price, is exactly the rate squared: 1.00% at a 10% rate, 4.00% at 20%, 6.25% at 25%. On a £1,000 gross that is £9, £33 and £50 respectively. The reason is algebraic: the correct net is G ÷ (1 + r) and the mistaken one is G × (1 − r), so the gap is G × r² ÷ (1 + r). Divide that by the correct net and the (1 + r) cancels, leaving r². The mistake is invisible at low rates and expensive at high ones.
- What percentage of a gross price is VAT?
- Always less than the rate itself. At 20% the tax is one sixth of the gross, or 16.67%. At 10% it is 9.09%. The reason is that the rate is defined against the net price, but the gross is net plus tax, so the same amount of tax is being measured against a bigger denominator. This calculator shows the share of gross alongside the rate precisely because the two get confused when people estimate what they owe from a bank balance.
- Are the preset rates guaranteed to be current?
- No, and you should not treat them that way. The presets were checked on 24 August 2026 and are shown with that date on screen. Rates change by legislation, sometimes at short notice and sometimes temporarily — Germany cut its standard rate for six months in 2020, and the UK ran a reduced hospitality rate into 2022. The rate field is always editable for exactly this reason. Confirm the rate with the tax authority before it goes on an invoice.
- Does this handle reduced and zero rates?
- Yes, by typing them in. Where a country operates reduced rates, they are listed under the rate field as a reminder of what exists, but they are not applied automatically because which rate applies depends on what you are selling, not where you are. Books, food, children's clothing, energy and passenger transport are common candidates, and the boundaries are genuinely intricate. Zero-rating also behaves differently from exemption in a way this tool cannot infer from a number.
- Is my pricing data sent anywhere?
- No. The whole calculation is a multiplication and a division running in your browser, and there is no request to send. Nothing you type leaves the device, which matters more here than it looks: unreleased prices, margins and client quotes are exactly the kind of figures people paste into whatever calculator ranks first.
Sources
The formulas and rates used by this tool come from the documents below. Rules change; when a figure here disagrees with the source, the source is right.
Figures checked against the sources below on September 1, 2026.
- VAT rates on different goods and servicesGOV.UK (HM Revenue & Customs)
- VAT rates applied in the Member StatesEuropean Commission