VAT Calculator

Use VAT Calculator

Adds VAT to a net figure, or works the VAT back out of a gross one. The second direction is the one people get wrong.

Amount before VATVAT rate %

Removing VAT is not subtracting the percentageTaking 20% off a gross price of 120 gives 96, but the correct net figure is 100. Going backwards means dividing by 1.20, not subtracting a fifth - an error that quietly understates every net figure on an invoice.

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About VAT Calculator

Adding VAT is easy and almost nobody gets it wrong. Taking it back out is where the mistakes live, and they are surprisingly common on real invoices. The instinct is to subtract the rate: if VAT is twenty per cent, take twenty per cent off the gross figure. That is wrong, and it is wrong in a direction that understates the net amount every time. A gross price of one hundred and twenty at twenty per cent has a net of exactly one hundred, but subtracting twenty per cent gives ninety-six. The four pounds of difference exists because the percentage was originally applied to the smaller number, so reversing it means dividing by one point two rather than subtracting a fifth. This calculator does both directions and, when working backwards, shows what the subtraction mistake would have produced so the gap is unmistakable.

Using VAT Calculator

Adding VAT multiplies the net figure by the rate and reports the tax and the gross total separately, which is the breakdown an invoice needs.
Removing VAT divides the gross figure by one plus the rate. That division is the only correct way back, and it is the step the common mistake skips.
Both directions report all three numbers - net, VAT and gross - so the figure you need is present whichever way round you started.
The rate is a free field rather than a fixed list, so it covers the standard and reduced rates of any country, historical rates, and sales-tax percentages that are not called VAT at all.
When removing VAT, the result also states what subtracting the percentage would wrongly have given, because seeing both numbers is what makes the difference stick.

Where vat calculator helps

Getting the net figure from a receipt

Enter the total paid and the rate, and use Remove VAT. This is the number your bookkeeping needs, and it is the one that gets miscalculated most often.

Quoting a price inclusive of tax

Enter your net price and add VAT to get the figure a consumer should see. Consumer-facing prices are normally quoted gross, while business-to-business quotes are usually net.

Before you use the result

This is arithmetic, not tax advice. Which rate applies to a given product or service, and whether VAT applies at all, is a question for your tax authority or accountant.
Reduced and zero rates vary by category and by country, and change over time. Enter the rate that applies to your transaction rather than assuming the standard one.
Rounding rules for invoices differ between jurisdictions, particularly on multi-line documents. Some require rounding per line and others on the total, which can produce a penny of difference from this result.
Cross-border sales, reverse charge, and marketplace rules can move the VAT liability elsewhere entirely. None of that is modelled here.
The result is rounded to two decimal places for display, so recalculating from a rounded figure may differ very slightly from the exact value.

Questions about VAT Calculator

How do I remove VAT from a total?

Divide by one plus the rate. At 20%, divide the gross by 1.2. Do not subtract 20%, which gives a different and incorrect answer.

Why is subtracting the percentage wrong?

Because the VAT was calculated on the net figure, which is smaller than the gross. Taking the same percentage off the larger number removes too much: 120 minus 20% is 96, but the true net is 100.

Which VAT rate should I use?

Whichever applies to your goods or services in your country. The field accepts any rate, including reduced rates and historical ones such as 17.5%.

Does this work for sales tax and GST?

Yes, where the tax is a simple percentage of the price. It does not handle compound or stacked taxes where one is charged on top of another.

Are the amounts I enter recorded?

No. It is arithmetic performed in this tab, with nothing transmitted or stored.