01 / START WITH YOUR NUMBERS
How to use the VAT calculator
Choose the direction
Select add VAT if the amount excludes VAT, or remove VAT if it already includes VAT. This choice changes what the amount field represents.
Enter the amount and rate
Use the standard, reduced or zero-rate option, or enter a custom rate. Selecting a rate does not establish whether it applies to the goods or services.
Read the breakdown
Net is the amount before VAT. VAT is the tax component. Gross is the net amount plus VAT. The headline changes depending on whether you are adding or removing tax.
02 / THE NUMBERS IN PRACTICE
A worked example
The default adds 20% VAT to a £100 net price. It produces £20 of VAT and a £120 gross total. To reverse this, choose remove VAT and enter £120 at the same rate.
£120.00
- Net amount (excluding VAT)
- £100.00
- VAT amount
- £20.00
- Gross amount (including VAT)
- £120.00
Fixed illustration using the starting inputs, separate from the live calculator above. Displayed amounts are rounded.
UK standard, reduced and zero rates checked 10 September 2026. One amount and one rate per calculation. This does not determine whether a supply is taxable, exempt or eligible for a particular rate.
03 / UNDERSTAND YOUR RESULT
Why removing 20% VAT is not subtracting 20%
A £120 gross price contains £100 of net value and £20 of VAT. The £20 is 20% of the net price, but only one sixth of the gross price. Subtracting 20% from £120 would give £96, which is not the correct net amount.
To remove VAT at 20%, divide the gross amount by 1.2. The difference between that net figure and the gross price is the VAT. At 5%, divide by 1.05. The same approach works for a custom rate.
04 / UNDERSTAND YOUR RESULT
Check the rate and the way an invoice is rounded
GOV.UK lists the UK standard rate as 20%, the reduced rate as 5% and the zero rate as 0%. Some supplies are exempt. Zero-rating and exemption are different classifications, even though neither adds VAT to the price in this simple arithmetic.
The calculator treats the entered amount as one total at one rate and rounds the displayed amounts to pennies. An invoice with several line items or several rates may need separate calculations. Rounding each line first can differ from calculating tax on an unrounded combined total.
PLAIN ENGLISH, PLEASE
VAT glossary
The terms behind the inputs and results, explained without the guesswork.
- Net
- The amount excluding VAT.
- VAT
- Value Added Tax. The amount calculated by applying the selected rate to the net value.
- Gross
- The amount including VAT: net plus tax.
- Standard rate
- The 20% UK VAT preset used in the calculator, checked against GOV.UK.
- Reduced rate
- The 5% UK VAT preset. Applicability depends on the supply.
- Zero-rated
- A taxable supply with a 0% VAT rate, distinct from an exempt supply.
- Custom rate
- An entered percentage used for arithmetic only; it is not a determination of the correct tax rate.
BEHIND THE ESTIMATE
How the calculation works
To add VAT, multiply net by the rate divided by 100 to find tax, then add it to net. Equivalently, gross = net × (1 + rate ÷ 100).
To remove VAT, net = gross ÷ (1 + rate ÷ 100), and VAT = gross − net. At zero rate, net and gross are equal. Values are calculated without intermediate rounding and formatted to two decimal places. This is not an invoice, VAT return or tax-classification service.
Sources and further reading
Examples use Switcha’s calculation model above. Supporting information and linked guidance checked on 10 September 2026.