About the VAT Calculator converter
UK VAT (Value Added Tax) is a consumption tax added to most goods and services. Depending on the item it is charged at 20% (standard), 5% (reduced, e.g. domestic energy), or 0% (zero-rated, e.g. most food and children's clothes). This calculator lets you add VAT to a net price or remove VAT from a gross price.
Add VAT to a net price
To add 20% VAT, multiply the net amount by 1.20. So £100 net becomes £120 gross, of which £20 is VAT. For the 5% reduced rate, multiply by 1.05.
Remove VAT from a gross price
This is the calculation people get wrong most often. To remove 20% VAT from a gross figure, divide by 1.20, not multiply by 0.80. So a £120 gross price is £100 net and £20 VAT. Multiplying by 0.80 would give £96, which is £4 short.
Who has to charge VAT?
In the UK, a business must register for VAT once its taxable turnover in any rolling 12-month period exceeds the current registration threshold. Below that, registration is voluntary. Once registered, VAT must be added to standard-rated sales and reported to HMRC, usually quarterly.
Frequently asked questions
- Is VAT the same as sales tax?
- They serve a similar purpose but work differently. Sales tax (used in the US) is charged only at the point of final sale. VAT is charged at every stage of the supply chain, with registered businesses reclaiming VAT they pay on inputs, so only the final consumer bears the full cost.
- What is the UK VAT rate in 2026?
- The UK standard rate is 20%, the reduced rate is 5%, and the zero rate is 0%. These rates have been unchanged since 2011, but always confirm with HMRC before filing.
- Do I charge VAT to customers abroad?
- Rules depend on whether you sell goods or services, whether the customer is a business or consumer, and where they are based. Post-Brexit rules changed significantly for EU trade. Speak to an accountant for anything non-trivial.