Adding VAT
To add VAT, multiply the net price by the rate and add it on — or just multiply by one plus the rate:
Gross = Net × (1 + VAT rate)
A net price of 100 at 20% VAT becomes 100 × 1.20 = 120, with 20 of that being VAT.
Removing VAT
To work backward from a VAT-inclusive price, divide by one plus the rate:
Net = Gross ÷ (1 + VAT rate)
A gross price of 120 at 20% is 120 ÷ 1.20 = 100 net, leaving 20 of VAT. Note you can't simply subtract 20% from the gross — that removes too much, because the VAT was added to the smaller net figure.
Common VAT rates
The UK standard rate is 20% (with 5% and 0% reduced rates); most EU countries fall between 17% and 27%. For US-style sales tax added at the register, use the sales tax calculator instead.
Frequently asked questions
How do I add VAT to a price?
Multiply the net price by the VAT rate to get the VAT amount, then add it on. At a 20% rate, a £100 net price has £20 of VAT, for a £120 gross price. Or simply multiply the net price by 1.20.
How do I remove VAT from a gross price?
Divide the gross (VAT-inclusive) price by one plus the rate. To strip 20% VAT from a £120 gross price, divide by 1.20 to get £100 net; the difference, £20, is the VAT. Do not just take 20% off the gross — that gives the wrong answer.
Why can't I just subtract 20% to remove VAT?
Because the 20% was added to the smaller net figure, not the larger gross one. Taking 20% off the gross removes too much. The correct step is to divide by 1.20, which is equivalent to removing about 16.67% of the gross price.
What VAT rate should I use?
It depends on the country and product. The UK standard rate is 20%, with reduced rates of 5% and 0% for some goods. Many EU countries sit between 17% and 27%. Enter whatever rate applies to your sale.
What is the difference between VAT and sales tax?
VAT is collected at each stage of production and is built into the displayed price in most countries, while US-style sales tax is added once at the register. The math here mirrors a tax-inclusive price; for US sales tax added at checkout, use a sales tax calculator.
Disclaimer: Results are estimates for general use. Confirm the correct VAT rate and treatment for your goods and jurisdiction with the relevant tax authority.