UK VAT calculator
The compulsory VAT registration threshold is £90,000 of taxable turnover in any rolling 12 months.
- Net (excluding VAT)£1,000.00
- VAT at 20%£200.00
Gross (including VAT)
£1,200.00
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How does the vat calculator work?
To add 20% VAT multiply the net price by 1.2. To remove it, divide the VAT-inclusive price by 1.2. For example £100 plus VAT is £120, and £120 including VAT is £100 net with £20 VAT. The UK has a standard rate of 20%, a reduced rate of 5% and a zero rate.
How it works
Adding VAT
Multiply the net amount by 1 plus the VAT rate. At 20% that is net × 1.2, so £250 becomes £300, of which £50 is VAT.
Removing VAT
Divide the gross amount by 1 plus the VAT rate, not by 0.8. Dividing £300 by 1.2 gives £250 net and £50 VAT. Taking 20% off £300 would wrongly give £240.
When you must register
You must register for VAT once your taxable turnover passes £90,000 in any rolling 12 months, or you expect it to in the next 30 days. You can register voluntarily below that, which can help you reclaim VAT on costs.
Rates used, 2026/27
- Standard rate20%
- Reduced rate5%
- Zero rate0%
- Registration threshold£90,000
Last checked November 2026 against GOV.UK: VAT rates. General information, not tax advice.
A worked example
A £1,250 invoice including 20% VAT is £1,041.67 net with £208.33 VAT. Dividing by 1.2 gives the right answer; subtracting 20% would not.
Questions about this calculator
Which goods are zero-rated or reduced-rated?
Most food, children's clothes and books are zero-rated, while domestic fuel and some energy-saving installations are reduced-rated at 5%. Many services, such as insurance and education, are exempt rather than zero-rated.
What is the difference between zero-rated and exempt?
Zero-rated sales are taxable at 0%, so you can still reclaim VAT on costs. Exempt sales are outside VAT, and you generally cannot reclaim related VAT.
Do I need Making Tax Digital for VAT?
Yes. All VAT-registered businesses must keep digital records and file VAT returns through compatible software.
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