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What is a VAT calculator?
A VAT Calculator adds value-added tax (VAT) to a net price or removes it from a price that already includes VAT. VAT is used in the UK, the EU and many other countries; unlike US sales tax, it is usually included in the shelf price. The calculator is useful for freelancers and businesses preparing invoices for clients abroad, US shoppers buying from overseas sites, and travelers checking prices.
How to use it
- Choose Add VAT (you know the net price) or Remove VAT (you know the VAT-inclusive price).
- Enter the amount.
- Enter the VAT rate or pick a common one (5%, 15%, 20%, 21% or 25%).
- Click Calculate to see the net amount, the VAT and the gross amount.
VAT formulas
Adding VAT: VAT = Net × Rate; Gross = Net × (1 + Rate)
Removing VAT: Net = Gross ÷ (1 + Rate); VAT = Gross − Net
Examples
- Add 20% VAT to 500: VAT = 100, gross = 600.
- Remove 20% VAT from 600: net = 600 ÷ 1.2 = 500, so the VAT is 100, not 120.
- Remove 21% VAT from 121: net = 100, VAT = 21.
A common mistake is to take the rate straight off a VAT-inclusive price; always divide by (1 + rate) instead.
VAT rates differ by country and product
Each country sets its own standard VAT rate, and many have reduced or zero rates for items such as food, books or children’s clothing. For example, the UK standard rate is 20%. Always use the rate that applies to the specific country and item; the calculator lets you enter any rate.
VAT vs. US sales tax
VAT is collected at every stage of production and is normally included in the price you see. US sales tax is charged only at the final sale and is usually added at the checkout. For US purchases, use the Sales Tax Calculator.
Tips
- On an invoice, show the net amount, the VAT rate and the VAT amount separately.
- Check whether a price is quoted including or excluding VAT before comparing suppliers.
- VAT registration and filing rules vary by country; confirm them with the local tax authority.
Frequently Asked Questions
VAT, or Value Added Tax, is a consumption tax applied to many goods and services. Businesses generally collect VAT from customers and account for it according to the applicable tax rules.
The standard UK VAT rate is 20%. However, some goods and services can have different VAT treatments, including reduced or zero rates.
Multiply the net price by 0.20 to get the VAT, or by 1.20 to get the total. For example, 100 net gives 20 VAT and 120 in total.
For a price that already includes 20% VAT, divide the gross amount by 1.20 to find the net price. The difference between the gross and net amounts is the VAT.
Yes. Type any rate into the VAT rate box, for example 5%, 7.5% or 25%, depending on the country and item.
Disclaimer: This calculator gives estimates for general information only. It is not financial, tax or legal advice. Results depend on the numbers you enter and on simplified assumptions, so your actual figures may differ. Check important decisions with a qualified professional or the official source.
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