VAT Calculator
Add or remove VAT at 20%, 5% or 0%. Calculate VAT-inclusive and VAT-exclusive amounts instantly.
Source: GOV.UK — VAT rates
By Konstantin Iakovlev · Founder, Calks.uk
Last updated: · Verified against HMRC and GOV.UK 2026/27 rates
Quick Answer
UK VAT standard rate is 20% (reduced 5%, zero 0%). To add VAT: multiply by 1.20. To remove VAT: divide by 1.20. The VAT-inclusive total divided by 6 gives the VAT portion. VAT registration threshold is £90,000.
Disclaimer
This calculator is provided for informational purposes only and should not be considered as financial or tax advice. All calculations are performed locally in your browser — no personal data is collected or sent to our servers. Rates and thresholds are sourced from HMRC and GOV.UK and are updated for the current tax year. Always verify results with HMRC or consult a qualified professional before making financial decisions.
UK VAT rates
| Rate | Applies to |
|---|---|
| 20% Standard | Most goods and services |
| 5% Reduced | Domestic energy, children car seats, mobility aids, sanitary products |
| 0% Zero | Most food, children clothing, books, prescription medicines, public transport |
| Exempt | Insurance, finance, education, healthcare (cannot reclaim input VAT) |
How It Works
Value Added Tax (VAT) in the UK is charged at three rates: Standard (20%), Reduced (5%) and Zero (0%). The standard rate applies to most goods and services. The reduced rate covers items like home energy, child car seats and mobility aids. The zero rate applies to essentials including most food, children's clothing and books.
This calculator supports three modes: Add VAT (calculate the gross from a net amount), Remove VAT (find the net from a gross amount) and Reverse VAT (extract the VAT component from a VAT-inclusive total). The formula to remove 20% VAT from a gross price is: Net = Gross ÷ 1.20.
Businesses with VAT-taxable turnover above £90,000 (the 2026/27 threshold) must register for VAT. Below this threshold, voluntary registration is possible.
UK VAT rates 2026/27. Standard 20%: most goods and services. Reduced 5%: domestic energy, mobility aids, child car seats, sanitary products. Zero 0%: most food, children's clothing, books (including ebooks since 2020), prescription medicines, public transport. Exempt: insurance, finance, education, healthcare. VAT registration threshold £90,000 (raised from £85,000 April 2024).
Three VAT calculation modes. Add VAT: net × 1.20 = gross. Remove VAT: gross ÷ 1.20 = net. Reverse (find VAT in inclusive price): gross ÷ 6 = VAT. £120 ÷ 6 = £20 VAT. NEVER subtract 20% from gross to get net — wrong. £120 − 20% = £96, but correct net is £100. VAT is 20/120 = 1/6 of gross, not 20% of gross.
VAT registration — when mandatory. Turnover £90,000+/year (rolling 12-month period). 30-day forward-test: if expecting £90k+ in next 30 days alone, register immediately. Voluntary registration any level: useful if selling B2B (clients reclaim VAT) or significant input VAT. Avoid if B2C and not crossing threshold — 20% price increase loses competitiveness.
VAT schemes for small businesses. Flat Rate Scheme (FRS): pay fixed % of gross turnover, simpler. Cash Accounting: VAT only on customer payments received, helps cash flow. Annual Accounting: 9 monthly instalments + balancing payment. MTD (Making Tax Digital) mandatory: digital records + compatible software (Xero, QuickBooks, FreeAgent).
Common VAT mistakes 2026. (1) Missing registration threshold — backdated VAT + penalties. (2) Charging VAT on exempt items. (3) Reclaiming on blocked items (client entertaining). (4) Wrong rate (5% reduced is narrow). (5) Late returns: £200 penalty + surcharges. (6) Confusing zero-rate (VAT-able at 0%) with exempt (no VAT). HMRC investigations active — penalties up to 100% of underpaid VAT.
Example: Adding 20% VAT to £500
- Net amount: £500.00
- VAT at 20%: £500.00 × 0.20 = £100.00
- Gross amount: £600.00
- To reverse: £600 ÷ 1.20 = £500 net
Source: GOV.UK — VAT rates
Frequently Asked Questions
- UK VAT rates and exemptions.
- Standard 20% — most goods/services. Reduced 5% — domestic energy, children's car seats, mobility aids, sanitary products. Zero 0% — most food, children's clothing, books, prescription medicines, public transport. Exempt — insurance, finance, education, healthcare (cannot reclaim input VAT). Standard rate has been 20% since January 2011 (was 17.5% 1991-2010, 15% temporarily 2008-2010).
- How to add or remove VAT — the math.
- Add 20% VAT: multiply NET by 1.20. Net £100 + VAT = £120. Remove 20% VAT: divide GROSS by 1.20. Gross £120 ÷ 1.20 = £100 net. The VAT portion of a gross amount = divide by 6 (since 20/120 = 1/6). £600 gross ÷ 6 = £100 VAT, £500 net. For 5% reduced rate: multiply by 1.05 to add; divide by 1.05 to remove; gross/21 = VAT portion.
- When do I need to register for VAT?
- Compulsory at £90,000 taxable turnover in any rolling 12-month period (2026/27 threshold, raised from £85,000 in April 2024). Register within 30 days. Voluntary registration permitted at any level — beneficial if customers are VAT-registered (they reclaim, neutral to them) OR you sell zero-rated goods (you reclaim input VAT). Once registered, charge VAT on supplies and submit MTD-compliant quarterly returns. De-register if turnover drops below £88k.