Reverse VAT Calculator
Work out the VAT included in a price or add VAT to a net amount. Choose a VAT rate, enter your amount and get the net, VAT and gross figures in seconds.
What Is a Reverse VAT Calculator?
A Reverse VAT Calculator helps you find the VAT element inside a VAT-inclusive price. For example, if an item costs £120 including VAT at 20%, the calculator separates that total into a net price of £100 and VAT of £20.
The calculator can also work in the opposite direction. Select Add VAT to calculate the VAT and total price from an amount that does not yet include VAT. This makes it useful for checking prices, preparing estimates and understanding invoice totals.
How to Use This Reverse VAT Calculator Step by Step
- Choose Remove VAT if your amount already includes VAT, or Add VAT if it is a net amount.
- Enter the amount in pounds (£).
- Select the VAT rate that applies, enter the exact percentage you want to use, such as 20, 5, 7.5 or 17.5.
- Press Calculate VAT to see the net amount, VAT amount and gross amount.
- Use Reset to start a new calculation.
How Does Reverse VAT Calculation Work?
When VAT is included in a total price, you cannot find the VAT amount accurately by simply taking 20% of the gross total. The VAT percentage is applied to the net price, not to the VAT-inclusive price. To reverse the calculation, divide the gross amount by one plus the VAT rate expressed as a decimal.
For a 20% rate, the gross price represents 120% of the net price. Dividing the gross amount by 1.20 gives the original net amount. Subtract that net amount from the gross total to find the VAT included.
Reverse VAT Formula: How to Remove VAT
Use these formulas when the amount you enter already includes VAT:
Net = Gross ÷ (1 + VAT rate ÷ 100)VAT = Gross − NetExample at 20% VAT: £120 ÷ 1.20 = £100 net. Then £120 − £100 = £20 VAT.
How to Add VAT to a Net Price
If your starting amount does not include VAT, calculate VAT by multiplying the net amount by the VAT rate. Add that VAT to the net amount to get the gross total.
VAT = Net × (VAT rate ÷ 100)Gross = Net + VATExample at 20% VAT: £100 × 0.20 = £20 VAT. The total including VAT is £100 + £20 = £120.
Reverse VAT Calculation Examples
Example 1: Remove 20% VAT from £120
Divide £120 by 1.20 to get £100. The VAT included in the price is £20.
| Gross price | £120.00 |
| Net price | £100.00 |
| VAT included (20%) | £20.00 |
Example 2: Remove 5% VAT from £105
Divide £105 by 1.05 to get £100. The VAT included in the price is £5.
| Gross price | £105.00 |
| Net price | £100.00 |
| VAT included (5%) | £5.00 |
Example 3: Add 20% VAT to £250
20% of £250 is £50, so the total price including VAT is £300.
| Net price | £250.00 |
| VAT added (20%) | £50.00 |
| Gross price | £300.00 |
Net Price vs Gross Price: What Is the Difference?
Net price is the amount before VAT is added. Gross price is the final amount after VAT has been included. The VAT amount is the difference between the gross and net figures.
- Net: price excluding VAT.
- VAT: the tax amount calculated on the net price.
- Gross: price including VAT.
Which VAT Rate Should You Use?
The correct VAT rate depends on the goods or services and the applicable UK VAT rules. The standard UK VAT rate is 20%, while some supplies qualify for a reduced rate or zero rate. Some goods and services may be exempt or outside the scope of VAT; these are not automatically the same as zero-rated supplies.
Choose the rate that applies to the specific transaction rather than assuming every purchase uses the standard rate. If you are unsure, check current official HMRC guidance or ask a qualified tax adviser.
Frequently Asked Questions
1. What is the easiest way to calculate VAT backwards?
Divide the VAT-inclusive price by 1 plus the VAT rate as a decimal. At 20%, divide the gross price by 1.20 to find the net price. Subtract the net price from the gross price to find the VAT.
2. How do I remove 20% VAT from a price?
Divide the total price by 1.20. For example, £120 including 20% VAT becomes £100 excluding VAT, with £20 VAT included.
3. Why do I divide by 1.20 instead of subtracting 20%?
VAT is calculated as a percentage of the net price. The gross price at 20% VAT is therefore 120% of the net price. Dividing by 1.20 reverses that calculation; subtracting 20% from the gross price would give the wrong result.
4. Can I remove 5% VAT with this calculator?
Yes. Enter 5 in the VAT rate field, enter the VAT-inclusive amount and choose Remove VAT. The calculator will show the net amount and VAT included.
5. Can I use this calculator to add VAT?
Yes. Choose Add VAT, enter the net amount and enter the applicable percentage in the VAT rate field. The results show the VAT added and the total gross price.
6. What is the difference between zero-rated and VAT-exempt?
Zero-rated supplies are taxable at a 0% VAT rate, while exempt supplies are treated differently under VAT rules. They are not interchangeable categories. Check HMRC guidance for the correct treatment of a particular supply.
7. Is reverse VAT calculation the same as the reverse charge?
No. Reverse VAT calculation means working backwards from a VAT-inclusive price to find its net and VAT components. The VAT reverse charge is a separate tax-accounting mechanism under which the customer accounts for VAT on certain supplies. This calculator does not determine whether the reverse charge applies.
8. Can I enter my own VAT percentage?
Yes. The VAT rate field accepts your own percentage from 0% to 100%, including decimal rates such as 7.5% or 17.5%. Enter the rate that applies to your transaction.
9. Does the calculator round the results?
Yes. Results are displayed to two decimal places, which is the usual format for pound amounts. Invoice and accounting systems may apply their own rounding rules to individual line items.