Add or remove VAT in one step
VAT is a percentage added to a price. To add it, multiply the net price (the price before VAT) by one plus the rate: 100.00 at 20% becomes 120.00, of which 20.00 is VAT. To remove it, go the other way: divide the gross price (the price with VAT) by one plus the rate. This page does both with the rate you type in, and it can also find a missing figure when you know any two of rate, net price, gross price and VAT amount.
The 20% used in the examples is only an editable example. It is not a statement of the rate that applies to your sale or purchase, which depends on what is being supplied and where.
VAT formulas: net, gross and tax amount
Write the rate as a decimal t, so 20% is 0.20. Then the gross price is net × (1 + t), the VAT amount is net × t, and the VAT amount also equals gross − net. Rearranging gives net = gross ÷ (1 + t). The VAT in a gross price is therefore gross × t ÷ (1 + t), not gross × t. On a 120.00 gross price at 20% the VAT is 20.00, not 24.00, because the 20% was charged on the smaller net amount.
If a rate is entered as zero, the gross price equals the net price and the VAT amount is zero. A rate of zero entered here is simply arithmetic; whether a particular supply is zero-rated, exempt or outside scope is a legal classification this calculator does not make.
Four quantities are linked by two equations, so any two known values fix the other two. That is why the calculator asks for exactly two, shows the remaining ones as results and never lets a result feed back in as an input, which would over-constrain the next calculation.
Reverse VAT worked example: 120 back to 100
A receipt shows 120.00 including 20% VAT and you want the price before VAT. Divide by 1.20: 120.00 ÷ 1.20 = 100.00. The VAT is 120.00 − 100.00 = 20.00. A common mistake is to take 20% off the gross price, which gives 96.00 and understates the net price by 4.00. That is wrong because the 20% was added to the smaller net price, so taking 20% of the larger gross price removes too much; dividing by 1.20 undoes the addition exactly.
The same steps work at any rate. At 5%, a gross price of 105.00 divides by 1.05 to give 100.00 net and 5.00 of VAT; at 12.5%, 112.50 gives 100.00 and 12.50. Check any answer by adding VAT back: net × (1 + rate) should return the gross price you started from. If it does not, the wrong rate or the wrong base was used, and it is worth rechecking before the figure goes on an invoice.
Find the VAT rate or work from a tax amount
Sometimes the rate is the unknown. If the net price is 100.00 and the gross price is 120.00, the rate is gross ÷ net − 1 = 20%. If you know the net price and the VAT amount, the rate is the VAT divided by the net: 20.00 ÷ 100.00 = 20%. If you know the gross price and the VAT amount, subtract to get the net first (100.00) and then divide. With a rate and a VAT amount, divide the VAT by the rate to recover the net price: 20.00 ÷ 0.20 = 100.00.
Some pairs cannot be solved. A net price of zero with a gross price of zero, or a rate of zero with a VAT amount of zero, fits every possible answer, so the calculator says there is not enough information instead of returning zero. A rate worked out from your amounts is a mathematical result, not advice about the rate you are entitled to charge.
Invoice lines, mixed rates and rounding
An invoice often mixes rates. Two lines of 100.00 net, one at 20% and one at 5%, give a net total of 200.00, VAT of 25.00 and a gross total of 225.00. The overall VAT is 12.5% of net, but you should never apply that average to the invoice; each line carries its own rate, and the tool totals the lines by rate to show it. Line names are optional and stay in your browser.
Rounding can move the total by a penny. Take three lines of 0.05 net at 10%. Each line has 0.005 of VAT, which rounds half-up to 0.01, so rounding line by line gives 0.03. Adding the three unrounded amounts first gives 0.015, which rounds to 0.02. Neither is wrong; they are two documented policies. This calculator rounds each line by default, lets you round each rate group once instead, and shows a rounding-adjustment row where the two differ. Follow the method your invoicing rules require. The export contains the basis, rate, net, VAT, gross and the rounding policy for each line.
VAT and sales tax: where this calculator stops
VAT is charged at each step of a supply chain on that step's own net price. Suppose a producer invoices 50.00 net, a wholesaler invoices 80.00 net and a shop invoices 120.00 net, all at 20%. The VAT shown is 10.00, 16.00 and 24.00, and the final customer pays 144.00 gross. Which of those amounts a business may recover is a legal question this calculator does not answer, and it does not look up rates, check registration or prepare a VAT return.
A US-style sales tax is a single tax added at the till, so the arithmetic is the same but the language and the invoices differ; the sales tax calculator covers that case. For VAT prices, check the price and profit margin on a net price, compare tax-inclusive unit costs, or work out the sale price before tax when a discount comes first.
VAT questions
How do I remove VAT from a gross price?
Divide the gross price by one plus the rate, then subtract the net from the gross to get the VAT. For 20% VAT, divide by 1.20. Multiplying by 0.80 is a common error that gives a lower net price than the correct one. Always confirm the rate on your invoice or receipt rather than assuming it.
Is the net price before or after VAT?
On this page the net price excludes VAT and the gross price includes it. The VAT amount is the difference between them. Many receipts show only the gross price, so remove VAT first if you need the net figure.
Can I calculate the VAT rate from a receipt?
Yes, if you know both the net and gross amounts and both are above zero. The result is a mathematical rate, not advice on which rate applies or whether you are eligible for any relief.
Why can invoice VAT differ by a penny?
Rounding each line and rounding a total once can give slightly different results, and mixed rates add more combinations. Choose the policy that matches your invoicing rules; the adjustment row shows the difference. If you compare two documents, check that both use the same policy before you look for a mistake.
Is zero-rated the same as exempt?
This tool treats a 0% rate as plain arithmetic. Legal classifications such as zero-rated and exempt, and the recovery rights that go with them, are outside its scope, so check with the tax authority instead of assuming they are equivalent.