VAT Calculator

Add VAT to a net price to find the tax and the gross amount a customer pays.

How the VAT Calculator works

To add VAT, multiply the net (ex-VAT) price by (1 + rate); to remove VAT from a gross (VAT-inclusive) price, divide the gross by (1 + rate). Those two operations are the entire calculator, and most VAT mistakes come from using the wrong one.

Adding VAT. Start from a net price and a rate written as a decimal. At the UK standard rate of 20%, a $100 net price becomes $100 x 1.20 = $120 gross, and the VAT itself is $100 x 0.20 = $20. The gross is what a customer abroad actually pays at the till, because outside the US displayed retail prices are legally VAT-inclusive.

Removing VAT. This is the step people get wrong. Given a $120 gross at 20%, you do not subtract 20% of $120. You divide: $120 / 1.20 = $100 net, and the VAT is the remainder, $20. The VAT was originally charged on the smaller net figure, not on the gross, so the inclusive percentage is always lower than the rate. At 20% the VAT is exactly 1/6 of the gross (16.67%), not 20%.

The fraction shortcut. The share of VAT inside any gross price equals rate / (100 + rate). So 20% is 20/120 = 1/6, 25% is 25/125 = 1/5, and 5% is 5/105 = 1/21. Memorize 1/6 for UK 20% and you can back out VAT in your head.

Why the rate field matters. VAT is not one number. Each country sets its own standard rate (UK 20%, Germany 19%, Ireland 23%, Hungary 27%) plus reduced and zero rates for specific goods. Enter the rate for the actual country of supply, because the same $100 net produces a different gross in each one.

Example calculation

Suppose you receive a supplier invoice from the UK showing a $599 VAT-inclusive total and you need the net price and the VAT for your books. At the 20% standard rate, divide: $599 / 1.20 = $499.17 net, and the VAT is $599 - $499.17 = $99.83. Subtracting 20% of $599 (which would wrongly give $479.20) overstates the discount and understates the VAT by about $20.

Now run the same purchase in a different country. If that $599 gross were charged in Germany at 19%, the math changes: $599 / 1.19 = $503.36 net, leaving $95.64 of VAT. Same sticker, different split, purely because the rate moved one point.

The feature that has no US equivalent is what happens next if you are a VAT-registered business. Say you bought supplies for $500 net and paid $100 of input VAT (20%), then resold finished goods for $800 net and charged $160 of output VAT. You do not hand the tax authority the full $160. You reclaim the $100 you already paid and remit only the difference: $160 - $100 = $60. Across the whole chain the government still collects exactly 20% of the final net price, but it is gathered in stages, with each business taxed only on the value it added. That self-correcting netting is the defining feature of VAT, and it is why a US sales-tax mindset (one tax, charged once, added at checkout) leads people astray on imported invoices.

Tips for using the VAT Calculator

• Always confirm whether your starting price is net or gross before touching the calculator. Adding VAT to a price that already includes it is the single most common error and inflates the figure by the rate twice over.
• To remove VAT, divide by (1 + rate); never subtract the rate. At 20%, dividing by 1.20 gives the net, while subtracting 20% overstates the discount and is off by a fixed margin.
• Memorize the inclusive fractions: VAT is 1/6 of a 20% gross, 1/5 of a 25% gross, and 1/21 of a 5% gross. These let you sanity-check the calculator without a spreadsheet.
• Set the rate to the country of supply, not your home country. The UK is 20%, but EU standard rates run from about 17% (Luxembourg) to 27% (Hungary), and the gross changes with every point.
• Do not confuse zero-rated with exempt. Both charge the customer $0 VAT, but a zero-rated seller can reclaim its input VAT while an exempt seller cannot, which changes the seller's true cost.
• If you are buying or invoicing inside the US, you almost certainly want sales tax, not VAT. The US has no national VAT, so use the sales tax calculator for domestic purchases.
• For VAT-registered businesses, track input VAT (on purchases) and output VAT (on sales) separately. What you remit is the difference, so reclaimable input VAT directly lowers your bill.
• When checking an inclusive retail price abroad, remember the sticker is the total you pay. Unlike a US shelf price, there is no extra tax added at the register.
• Use the reduced rate only for goods that legally qualify (such as UK 5% on domestic energy or child car seats). Applying a reduced rate to standard-rated goods underbills the tax.
• Round net and VAT so they sum back to the original gross. After dividing, recompute net + VAT and confirm it equals the gross you started with to catch rounding drift on invoices.

VAT vs US sales tax: the same item, two completely different systems

VAT is a multi-stage tax collected at every step of production and shown inside the displayed price, while US sales tax is a single-stage tax collected once at the final sale and added on top at checkout. They can produce the same final number on one transaction yet behave nothing alike across a supply chain.

Take a $100 net item sold at 20%. In a VAT country the shelf price reads $120, that $120 is what you pay, and $20 of it is VAT already baked in. In the US the shelf reads $100 and an 8% sales tax is added at the register to ring up $108 - the tax is bolted on, not embedded. More importantly, VAT is reclaimable by businesses along the chain, so only the final consumer truly bears it; US sales tax is generally charged only at the last retail sale to the consumer.

Feature	VAT (UK / EU / most countries)	US sales tax
Stages taxed	Every stage of production and distribution	Final retail sale only
Shown in price?	Yes, displayed price is VAT-inclusive	No, added at checkout
Business reclaim?	Yes, input VAT is reclaimable	No reclaim; resale exemption certificates instead
Typical rate	17% to 27% standard	0% to roughly 10% combined state and local
Who ultimately pays	Final consumer (via the chain)	Final consumer (directly)

If your purchase is domestic US, use the sales tax calculator. Reach for the VAT calculator only for overseas purchases, imports, or invoices priced with VAT.

Adding vs removing VAT: why you divide, not subtract

Adding VAT multiplies the net by (1 + rate); removing VAT divides the gross by (1 + rate) - and dividing is not the same as subtracting the rate. This is the core skill the calculator automates.

The reason is the base. When VAT was added, it was a percentage of the smaller net price. When you reverse it, that same VAT is now a smaller share of the larger gross. Concretely, on a $120 gross at 20%: dividing by 1.20 gives the $100 net and $20 of VAT, but naively subtracting 20% of $120 would give $96 and wrongly imply $24 of VAT. The error grows with the rate.

The inclusive share is always rate / (100 + rate): 16.67% at 20%, 20.00% at 25%, and 4.76% at 5%. So a $599 gross at 20% holds $99.83 of VAT (599 / 1.20 = 499.17 net), not the $119.80 you would get by mistakenly taking 20% off. Switching direction in the VAT calculator handles both safely.

Standard, reduced, and zero rates - and zero-rated vs exempt

Most countries run a standard rate plus one or more reduced rates and a 0% zero rate, and a separate exempt category that looks like 0% but works differently. Picking the right rate is as important as the arithmetic.

The standard rate applies to most goods and services (UK 20%). A reduced rate eases the burden on essentials - the UK charges 5% on things like domestic energy and child car seats. A zero rate taxes qualifying goods at 0% (in the UK, most food, books, and children's clothing).

The trap is zero-rated vs exempt. Both mean the customer pays no VAT, but the difference is on the seller's side. A zero-rated business charges 0% yet can still reclaim the input VAT on its own purchases. An exempt business (for example, some financial or health services) sits outside the VAT system entirely and cannot reclaim its input VAT, so that VAT becomes a buried cost. To the buyer the line is $0 either way; to the seller the two are worlds apart.

Country rates and why prices abroad are VAT-inclusive

VAT rates are set per country, and outside the US the law generally requires displayed retail prices to include VAT, so the sticker is the total you pay. The single number you enter as the rate is therefore country-specific.

Among major systems, the UK standard rate is 20%, Germany is 19%, the Netherlands is 21%, Ireland is 23%, the Nordic countries Denmark and Sweden are 25%, and Hungary tops the EU at 27%; Luxembourg sits near the low end around 17%. The same $1,000 net order is a $1,200 gross in the UK but a $1,270 gross in Hungary.

Inclusive pricing is why a European price tag of $9.99 is exactly what you hand over - the $1.66 of VAT (at 20%) is already inside it, and the net is $8.33. A US shopper used to seeing tax appear only at checkout should not add anything to an advertised VAT-inclusive price. Because rates change, always confirm the current figure for the specific country before invoicing; the VAT calculator accepts any rate you enter.

Common VAT mistakes that cost real money

The expensive VAT errors are nearly always about direction, base, or rate - not hard math. Here are the ones that recur on invoices.

• Subtracting the rate to remove VAT. Taking 20% off a $120 gross gives $96, but the correct net is $100. Always divide by (1 + rate).
• Adding VAT to a price that already includes it. Treating a $120 inclusive price as net and adding 20% bills the customer $144 - double-taxed. Confirm net vs gross first.
• Using your home rate on a foreign supply. A German 19% invoice run at the UK 20% misstates both net and VAT. Match the rate to the country of supply.
• Confusing zero-rated and exempt. Both show $0 VAT, but only zero-rated lets the seller reclaim input VAT; mislabeling distorts the business's recoverable tax.
• Forgetting to net input against output VAT. A registered business that remits its full output VAT without reclaiming input VAT overpays - on $160 output and $100 input you owe $60, not $160.
• Rounding so net and VAT do not sum to the gross. After splitting an inclusive price, re-add the parts and confirm they equal the original total.

Working out VAT by hand and in Excel

By hand, multiply net x rate for the VAT, or divide gross by (1 + rate) to strip it; in Excel, use =A1*(1+B1) to add and =A1/(1+B1) to remove. Both mirror the calculator exactly.

By hand. To add VAT to a $4,000 net invoice at Ireland's 23%: $4,000 x 23 = 92,000, divide by 100 = $920 VAT, so the gross is $4,920. To check a gross, $4,920 / 1.23 returns the $4,000 net. For UK 20% you can skip the long multiplication and just take 1/6 of the gross to find the embedded VAT.

In Excel or Google Sheets. Put the net in A1 and the rate as a decimal (0.20) in B1. Then:

• Add VAT (gross): =A1*(1+B1) - e.g. =250*(1+0.20) returns $300.
• VAT only: =A1*B1 - =250*0.20 returns $50.
• Remove VAT (net from gross): =A1/(1+B1) - =300/1.20 returns $250.

Format the cells as currency so they show $300.00 rather than 300. The VAT calculator does both directions without a spreadsheet.

The multi-stage mechanism: how VAT is actually collected

VAT is gathered piece by piece along the supply chain, with each business paying tax only on the value it adds, and the totals always sum to the rate applied to the final net price. This is the feature that separates VAT from any US tax.

Walk a 20% chain. A manufacturer sells goods for $100 net and charges $20 output VAT. A retailer buys at $100 net (paying $20 input VAT), then sells to a consumer for $300 net, charging $60 output VAT. The retailer reclaims its $20 input VAT and remits only $60 - $20 = $40. Add what each stage handed over: $20 from the manufacturer plus $40 from the retailer = $60, which is exactly 20% of the final $300 net. The consumer, who cannot reclaim, bears the whole $60.

This netting is why VAT is hard to evade and why it raises so much revenue worldwide. For a registered business the practical takeaway is simple: your liability is output VAT minus input VAT, so every dollar of reclaimable input VAT reduces what you owe. There is no equivalent reclaim in US sales tax.

VAT quick-reference: adding and removing VAT at common country rates

VAT is charged on the net price and is usually shown inside the displayed (gross) price abroad. To add VAT, multiply the net by (1 + rate); to remove it from a gross price, divide by (1 + rate). The table below recomputes both directions at common standard rates. Notice the VAT-in-gross fraction: at 20% the VAT is exactly 1/6 of the gross, and at 25% it is exactly 1/5.

Rate (country example)	Net $100 -> VAT added	Net $100 -> Gross	VAT inside $120 gross	VAT as fraction of gross
5% (UK reduced)	$5.00	$105.00	$5.71	1/21 (4.76%)
19% (Germany)	$19.00	$119.00	$19.16	15.97%
20% (UK)	$20.00	$120.00	$20.00	1/6 (16.67%)
21% (Netherlands)	$21.00	$121.00	$20.83	17.36%
23% (Ireland)	$23.00	$123.00	$22.44	18.70%
25% (Denmark/Sweden)	$25.00	$125.00	$24.00	1/5 (20.00%)
27% (Hungary, EU high)	$27.00	$127.00	$25.51	21.26%

Confirm the current rate for the specific country before invoicing, since rates change. The US has no VAT - use the sales tax calculator for US purchases.

Related on this site

sales tax calculator · discount calculator · percentage calculator · markup calculator · profit margin calculator

For a related deep dive, see UK government (gov.uk) VAT rates.

VAT Calculator — frequently asked questions

Common VAT rates?

Often 15–25% depending on country; reduced rates apply to some goods.

Remove VAT?

Divide the gross by (1 + rate) to get the net amount.

What is VAT?

A value-added consumption tax applied at each stage of the supply chain.

How do I extract VAT from a gross price?

Divide the gross by (1 + rate) to find the net amount.

How do I remove 20% VAT from a $599 gross price?

<p>Divide $599 by 1.20, which gives a net price of $499.17 and VAT of $99.83.</p><p>To strip VAT from any VAT-inclusive (gross) figure, divide by (1 + rate). You do <strong>not</strong> simply subtract 20%, because the VAT was added to the smaller net amount, not the gross. Our <a href="/vat-calculator/">VAT calculator</a> does this both ways. At 20%, the VAT is exactly 1/6 of the gross.</p>

Why isn't removing 20% VAT the same as taking 20% off the price?

<p>Because the two percentages are taken from different bases, so they give different results.</p><p>Take a $120 gross price. A 20% <em>discount</em> is 20% of $120 = $24, leaving $96. <em>Removing</em> 20% VAT means dividing $120 by 1.20 = $100, so the VAT is $20. The VAT was charged on the $100 net, not the $120 total, which is why you divide rather than subtract. The gap widens at higher rates.</p>

How much VAT is in a $1,000 gross price at 19%?

<p>The VAT is $159.66 and the net price is $840.34 at a 19% rate.</p><p>Divide $1,000 by 1.19 to get the net ($840.34), then subtract that from $1,000 for the VAT ($159.66). At 19% (a common EU rate, e.g. Germany), VAT is about 15.97% of the gross, not 19%. Use the <a href="/vat-calculator/">VAT calculator</a> in remove mode and switch the rate to match the country.</p>

What VAT formula do I type in Excel to add VAT?

<p>Use <strong>=A1*(1+B1)</strong> where A1 is the net price and B1 is the rate as a decimal (0.20 for 20%).</p><p>For example, =250*(1+0.20) returns $300. To isolate just the VAT, use =A1*B1 (=250*0.20 = $50). To <em>remove</em> VAT from a gross figure, use =A1/(1+B1): =300/1.20 returns the $250 net. Format the cells as currency. Our <a href="/vat-calculator/">VAT calculator</a> does both without a spreadsheet.</p>

What is VAT as a fraction of the gross price at each rate?

<p>At 20% the VAT is exactly 1/6 of the gross; at 25% it is exactly 1/5.</p><p>The fraction is rate / (100 + rate). So 20% gives 20/120 = 1/6 (16.67%), 25% gives 25/125 = 1/5 (20%), 5% gives 5/105 = 1/21 (4.76%), and 27% gives 27/127 (21.26%). These fractions let you back out VAT mentally. The <a href="/vat-calculator/">VAT calculator</a> computes any rate precisely.</p>

How is VAT different from US sales tax on the same purchase?

<p>VAT is collected at every stage of production and shown inside the displayed price, while US sales tax is collected once at the final sale and added at checkout.</p><p>On a $100 item, a US shelf price of $100 plus 8% sales tax rings up at $108. Abroad, a $120 shelf price already includes $20 of 20% VAT, so the net is $100. Businesses reclaim VAT they pay; consumers cannot. Compare with our <a href="/sales-tax-calculator/">sales tax calculator</a>.</p>

If my business buys $500 net and sells $800 net at 20%, how much VAT do I pay the tax authority?

<p>You remit $60: the $160 you collected minus the $100 you already paid on supplies.</p><p>You pay $100 input VAT buying at $500 net (20%), and charge $160 output VAT selling at $800 net (20%). VAT-registered businesses reclaim input VAT, so you only hand over the difference, $160 - $100 = $60. This multi-stage netting is the core of VAT and has no equivalent in US <a href="/sales-tax-calculator/">sales tax</a>.</p>

What is the difference between zero-rated and exempt VAT?

<p>Both mean the customer pays no VAT, but a zero-rated business can reclaim its input VAT while an exempt business cannot.</p><p>Zero-rated goods (often food, books, children's clothing in the UK) are taxed at 0%, so the seller still recovers VAT on its own purchases. Exempt supplies (such as some financial or health services) sit outside VAT entirely, so the provider absorbs the input VAT as a cost. The price to you is $0 VAT either way.</p>

How much VAT would a tourist reclaim on a $600 purchase at 20%?

<p>The VAT inside a $600 gross purchase at 20% is $100, which is the maximum reclaimable before any refund-service fee.</p><p>Divide $600 by 1.20 for the $500 net, leaving $100 of VAT. Tax-free shopping schemes refund this to eligible non-resident travelers, but processing companies usually keep a cut, so the cash back is often closer to $70 to $85. Note the US has no national VAT, so this only applies on overseas trips.</p>

What's the highest standard VAT rate, and what does it add to a $1,000 net order?

<p>Hungary has the EU's highest standard rate at 27%, which adds $270 to a $1,000 net order for a $1,270 gross total.</p><p>EU standard rates currently run roughly 17% (Luxembourg) up to 27% (Hungary), with the UK at 20%. At 27%, VAT is about 21.26% of the gross. Always confirm the current rate for the specific country, since rates change. Our <a href="/vat-calculator/">VAT calculator</a> accepts any rate you enter.</p>

A product shows 9.99 including 20% VAT. What is the net price?

<p>The net (ex-VAT) price is $8.33 and the VAT portion is $1.66 at a 20% rate.</p><p>Divide the $9.99 gross by 1.20 to get $8.33, then subtract for the $1.66 VAT. Outside the US, displayed retail prices are almost always VAT-inclusive by law, so the sticker is what you pay. In the US, by contrast, sales tax is added after the listed price. The <a href="/vat-calculator/">VAT calculator</a> reverses any inclusive price.</p>

How much VAT is on an $80 item at a 5% reduced rate?

<p>A 5% reduced rate on an $80 net item adds $4.00 of VAT, for an $84.00 gross price.</p><p>Multiply $80 by 0.05 for the $4 VAT. Reduced rates (the UK uses 5% for things like domestic energy and child car seats) sit below the standard rate to ease the burden on essentials. If $84 were the gross, the VAT inside it would be $84 / 1.05 = $80 net, or $4 VAT. Switch rates in the <a href="/vat-calculator/">VAT calculator</a>.</p>

Is 20% VAT the same as a 20% sales tax mathematically?

<p>For a single final sale the arithmetic is identical, but VAT differs because it is multi-stage and is normally quoted inside the price.</p><p>Adding 20% to a $100 net gives $120 either way. The real differences: VAT is collected and reclaimed at each step of the supply chain, and abroad the $120 is the advertised price. US sales tax hits only the final consumer and is added on top at checkout - see our <a href="/sales-tax-calculator/">sales tax calculator</a>.</p>

How do I work out the VAT on a $4,000 invoice at 23% by hand?

<p>Multiply $4,000 by 0.23 to get $920 of VAT, making the gross invoice $4,920 at a 23% rate.</p><p>By hand: $4,000 x 23 = 92,000, then divide by 100 = $920. Add it to the net for the $4,920 total. Ireland uses a 23% standard rate, so this matches a typical Irish B2B invoice. To check a gross figure, $4,920 / 1.23 returns the $4,000 net. The <a href="/vat-calculator/">VAT calculator</a> handles either direction.</p>

Does the US have VAT, and which calculator should I use?

<p>No, the United States has no VAT; it uses state and local sales tax instead, so US shoppers should use the sales tax calculator.</p><p>VAT applies in the UK, EU, and most other countries as an inclusive, multi-stage tax. If you are buying or invoicing domestically in the US, use our <a href="/sales-tax-calculator/">sales tax calculator</a>. Use the <a href="/vat-calculator/">VAT calculator</a> only for overseas purchases, imports, or invoices priced with VAT.</p>

What net price gives a round $250 gross at 25% VAT?

<p>A $200 net price plus $50 of 25% VAT equals a $250 gross total.</p><p>Divide $250 by 1.25 to get the $200 net; the $50 VAT is exactly one-fifth of the gross because 25% works out to 25/125 = 1/5. Several Nordic countries (such as Denmark and Sweden) use a 25% standard rate. To go the other way, $200 x 1.25 = $250. Try other rates in the <a href="/vat-calculator/">VAT calculator</a>.</p>

Guides & articles

• How VAT Works: The Multi-Stage Tax, Input Credits, and How It Differs From US Sales Tax
• How to Add and Remove VAT From a Price: The Divide-Don't-Subtract Rule

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