| Net (ex-VAT) | VAT | Gross (inc-VAT) |
|---|---|---|
| £100.00 | £20.00 | £120.00 |
| £250.00 | £50.00 | £300.00 |
| £500.00 | £100.00 | £600.00 |
| £1,000.00 | £200.00 | £1,200.00 |
| £2,500.00 | £500.00 | £3,000.00 |
| £5,000.00 | £1,000.00 | £6,000.00 |
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VAT Calculator UK — Add or Remove VAT in Seconds
About this tool
UK VAT Calculator — Add or Remove VAT Instantly
Value Added Tax is charged on most goods and services sold in the UK. Whether you are a freelancer raising invoices, a small business quoting a client, or a consumer trying to understand what you are paying, you regularly need to move between VAT-inclusive and VAT-exclusive prices. This UK VAT calculator lets you add or remove VAT at the standard 20% rate, the reduced 5% rate, the zero rate, or any custom percentage — and shows you the net amount, VAT amount, and gross total simultaneously. Once you have your VAT figures, use the Freelance Invoice Generator to create a professional PDF invoice in seconds.
Adding VAT (net to gross): If you quote clients a net price and need to add VAT for the invoice, select "Add VAT," enter your net amount, and choose the rate. The formula is: Gross = Net × (1 + rate). At 20%, a net price of £500 becomes a gross price of £600, with £100 of VAT. Removing VAT (gross to net): If you have received a VAT-inclusive price and need to find the underlying net amount, select "Remove VAT." The formula is: Net = Gross ÷ (1 + rate). A £600 VAT-inclusive price at 20% has a net element of £500 and a VAT element of £100.
A common mistake when removing VAT is to subtract 20% from the gross price (£600 − £120 = £480) rather than dividing by 1.20 (£600 ÷ 1.20 = £500). Subtracting a percentage always gives the wrong answer for reverse VAT calculations — you must divide by the gross factor.
UK VAT rates: The standard rate of 20% applies to most goods and services. The reduced rate of 5% applies to domestic fuel and power, children's car seats, and some energy-saving materials. The zero rate (0%) applies to most food, children's clothing, books, newspapers, medicine, and public transport. Zero-rated supplies differ from exempt supplies — zero-rated businesses can still reclaim input VAT on their purchases, while businesses making only exempt supplies generally cannot.
For freelancers and sole traders, VAT registration is mandatory once your annual taxable turnover exceeds £90,000 (the 2024/25 threshold). Once registered, you charge VAT on your invoices, file quarterly VAT returns with HMRC, and pay the difference between output tax (VAT charged to clients) and input tax (VAT you paid on business purchases). To understand your net take-home after tax and NI on top of your invoiced earnings, see the UK Take-Home Calculator. This tool runs fully in your browser — no financial data is uploaded, and inputs are auto-saved so they persist between sessions.
Features
- Add VAT mode — enter net price, get gross price and VAT amount instantly
- Remove VAT mode — enter gross price, extract net price and VAT element (reverse VAT)
- UK VAT rates — 20% Standard, 5% Reduced, 0% Zero, or any custom rate (0–30%)
- Visual net vs VAT breakdown bar showing proportion at a glance
- Quick-reference table — net, VAT, and gross for 6 common amounts at the current rate
- UK VAT registration threshold panel — key facts always visible
- Auto-detects your currency from browser locale — GBP default for UK visitors
- Manual currency override — 20 major currencies supported
- Copy full breakdown to clipboard for pasting into invoices or emails
- Auto-saves all inputs across sessions — no re-entering figures each visit
How to Use This VAT Calculator
- 1Choose Add VAT or Remove VATClick "Add VAT" if you have a net price (ex-VAT) and need to calculate the gross (inc-VAT) — for example when raising an invoice. Click "Remove VAT" if you have a VAT-inclusive price and need to extract the net amount and the VAT element — for example when reviewing a supplier invoice to reclaim input VAT.
- 2Enter the amountType the amount in the input field. If you selected "Add VAT," enter the net (ex-VAT) figure. If you selected "Remove VAT," enter the gross (inc-VAT) figure. The currency selector to the left defaults to GBP for UK visitors — change it if you are working in another currency. The results update instantly as you type.
- 3Select the VAT rateChoose from the four rate buttons: 20% Standard (most goods and services), 5% Reduced (domestic fuel, energy-saving products, children's car seats), 0% Zero (food, books, children's clothing, medicine), or Custom if you need a non-standard rate. For the Custom option, a slider and number input appear — drag or type to set any rate from 0 to 30%.
- 4Read the resultsThe large number at the top is the primary answer — gross price when adding VAT, net price when removing. Below that, three metric cards show net, VAT amount, and gross. The highlighted card (indigo border) shows your input value for easy reference. The breakdown bar shows the split between net and VAT as a percentage of the gross price.
- 5Use the quick-reference tableThe quick-reference table at the bottom shows net, VAT, and gross for six common round amounts (£100, £250, £500, £1,000, £2,500, £5,000) at your selected VAT rate. This is useful when quoting tiered pricing or when you need a mental benchmark for whether a calculated figure looks right. Click "Copy summary" to copy the key figures to your clipboard, then head to the Freelance Invoice Generator to build a complete invoice.
VAT for freelancers
VAT for UK Freelancers and Sole Traders
If your annual turnover exceeds £90,000, VAT registration is compulsory. Below that threshold, registration is optional but can be worth considering. If your clients are mainly VAT-registered businesses, they can reclaim the VAT you charge, so your prices become no more expensive to them — while you benefit from reclaiming VAT on your own business purchases.
Quoting clients: Always make clear whether your rate is quoted net or gross. Most UK freelancers quote day rates or project fees as net (ex-VAT) and add VAT on the invoice. Use the Freelance Invoice Generator to produce correctly formatted invoices showing net, VAT, and gross — and pair with the UK Take-Home Calculator to understand what you actually keep after income tax and National Insurance.
The Flat Rate Scheme: If your taxable turnover is below £150,000, you may be eligible for HMRC's Flat Rate Scheme. You still charge clients 20% VAT but pay HMRC a lower fixed percentage of your gross turnover. The difference is yours to keep. The rate varies by sector — IT and computer services: 14.5%, management consulting: 14%, accountancy: 14.5%.
Knowing your day rate: If you are pricing your freelance services, use the Salary to Hourly Calculator to convert annual contract value or salary equivalent into a daily or hourly rate before adding VAT.
Making Tax Digital: All VAT-registered businesses must use MTD-compatible software to keep digital VAT records and submit returns. Free and paid options include HMRC's own tools, FreeAgent, Xero, QuickBooks, and others.
Common VAT mistakes
Common VAT Calculation Mistakes
Subtracting instead of dividing to remove VAT. The most common mistake. If a price is £120 inc-VAT at 20%, subtracting 20% gives £96 — which is wrong. The correct answer is £120 ÷ 1.20 = £100. Always divide by (1 + rate) to reverse VAT.
Treating zero-rated as VAT-exempt. Zero-rated goods have VAT charged at 0%, but the supply is still a VAT-able supply. Businesses selling zero-rated goods can still reclaim input VAT on their purchases. Exempt supplies are different — businesses making only exempt supplies typically cannot register for VAT at all.
Not keeping VAT records. HMRC requires VAT-registered businesses to keep records of all VAT invoices received and issued, VAT account (summary of VAT charged and reclaimed), and VAT returns for at least 6 years.
Charging VAT before registration. You must not charge VAT until you are formally registered. If you breach the threshold and fail to register, HMRC can charge the VAT that should have been collected even if you did not collect it from your clients.
Common Use Cases
Frequently Asked Questions
To add 20% VAT to a net price, multiply the net amount by 1.20. For example, a net price of £100 becomes £120 including VAT (£100 × 1.20). The VAT amount is £20. The formula is: Gross = Net × (1 + VAT rate). For 20% VAT: Gross = Net × 1.20. This calculator does the arithmetic instantly — enter your net amount, make sure "Add VAT" is selected, and the gross price appears immediately.
To remove 20% VAT from a VAT-inclusive (gross) price, divide the gross amount by 1.20. For example, a gross price of £120 has a net price of £120 ÷ 1.20 = £100, and the VAT element is £20. The formula is: Net = Gross ÷ (1 + VAT rate). A common mistake is to take 20% off the gross price (which gives £96 rather than £100) — that is incorrect. Always divide by 1.20, not subtract 20%.
The UK has three main VAT rates: (1) Standard rate: 20% — applies to most goods and services, including professional services, electronics, clothing (adult), and most food served in restaurants. (2) Reduced rate: 5% — applies to domestic fuel and power, children's car seats, mobility aids for the elderly, and some energy-saving materials. (3) Zero rate: 0% — VAT is charged at 0% on most food, children's clothing, books and newspapers, medicine, and public transport. Zero-rated goods are different from exempt goods: zero-rated businesses can still reclaim VAT on their purchases.
The UK VAT registration threshold for 2024/25 is £90,000 in taxable turnover over any 12-month rolling period. If your business turnover exceeds £90,000, you must register for VAT with HMRC. You can also register voluntarily if your turnover is below the threshold — which can be beneficial if you sell to VAT-registered businesses, as they can reclaim the VAT you charge. Once registered, you must charge VAT on your taxable sales, file quarterly VAT returns, and pay the difference between the VAT you charge and the VAT you reclaim on purchases.
Freelancers must charge VAT on their invoices only if they are VAT-registered. You are required to register if your annual taxable turnover exceeds £90,000 (2024/25 threshold). Below this threshold, VAT registration is optional. When quoting clients, make clear whether your rates are quoted net (ex-VAT) or gross (inc-VAT), and whether VAT will be added on top. Most UK freelancers quote their day rates or project fees as net amounts, then add VAT on the invoice. If your client is a VAT-registered business, they can fully reclaim the VAT you charge.
A VAT-exclusive price (net price) is the cost before VAT is added. A VAT-inclusive price (gross price) is the total amount including VAT. For consumer advertising and retail, prices must legally be shown VAT-inclusive. For B2B transactions, prices are often quoted net (ex-VAT) because business buyers are typically VAT-registered and can reclaim the VAT anyway. On an invoice, both amounts should be shown: the net amount, the VAT amount, and the gross total.
Yes, if you are VAT-registered, you can reclaim VAT on business purchases (input tax) and offset it against the VAT you collect from customers (output tax). You pay HMRC the difference. If you spend more on VAT-able purchases than you collect, HMRC will refund the difference. VAT-registered businesses reclaim VAT on eligible expenses including equipment, supplies, professional subscriptions, and business-related services. You cannot reclaim VAT on non-business expenses, entertainment, or cars (with some exceptions).
The HMRC Flat Rate Scheme (FRS) is a simplified VAT scheme for small businesses with taxable turnover up to £150,000. Instead of calculating VAT on every sale and purchase, you pay a fixed percentage of your gross (VAT-inclusive) turnover to HMRC. The percentage varies by business sector — for example, IT consultants pay 14.5% and accountants pay 14.5%. You still charge your clients 20% VAT, but pay a lower flat rate to HMRC, keeping the difference as a profit. The Flat Rate Scheme is popular with freelancers in professional services, though it became less attractive after the 16.5% "limited cost trader" rate was introduced.