VAT Inclusive/Exclusive Calculator
Calculate price with or without VAT from any rate.
Enter inclusive or exclusive amount to instantly see both figures and the VAT portion in your currency.
VAT (Value Added Tax) is a consumption tax added to most goods and services. The standard UK VAT rate is 20%. Some goods have reduced rates (5% for domestic fuel and energy) or zero rates (most food, children’s clothing, books).
Adding VAT to a price: VAT amount = Net price × (VAT rate / 100) Gross price = Net price × (1 + VAT rate / 100)
Example: Net price £100 + 20% VAT: VAT = £100 × 0.20 = £20 Gross price = £120
Extracting VAT from a VAT-inclusive price (reverse VAT): Net price = Gross price / (1 + VAT rate / 100) VAT amount = Gross price − Net price
Example: VAT-inclusive price of £240 at 20% VAT: Net price = £240 / 1.20 = £200 VAT = £240 − £200 = £40
This is the most commonly made mistake — dividing £240 by 1.20 (not multiplying by 20% directly).
Common VAT rates in the UK:
- Standard rate: 20% (most goods and services)
- Reduced rate: 5% (domestic energy, children’s car seats, some renovations)
- Zero rate: 0% (most food, books, newspapers, children’s clothes)
- Exempt: no VAT charged and businesses cannot reclaim (financial services, postal services, insurance)
Worked example — restaurant bill: Food and drinks (VAT-inclusive) total: £85.60 At 20% VAT: Net amount = £85.60 / 1.20 = £71.33 VAT = £85.60 − £71.33 = £14.27
VAT registration threshold: UK businesses must register for VAT once turnover exceeds £90,000 (2024 threshold). Below this, VAT registration is optional but may be beneficial for B2B businesses that can reclaim input VAT.