data tool
VAT calculator for the UK
To add UK VAT at the standard rate, multiply the price by 1.2; to take VAT out of a VAT inclusive price, use the VAT fraction, which is one sixth at 20% and one twenty first at 5%. This calculator does both line by line with mixed rates, and says whether a simplified invoice will do.
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- Runs on your device, nothing is uploaded
- Free, no sign in
- No watermark, no file limit
How it works
- 1
Choose the direction
Pick whether the amounts are net, so VAT is added, or gross, so the VAT fraction is taken out.
- 2
Set each line's rate
Type an amount and pick 20% standard, 5% reduced or 0% zero rated for each line.
- 3
Read the totals
The panel shows net, VAT and gross totals, with the VAT worked out once per rate.
- 4
Check the invoice type
The note says whether the gross total is £250 or less, when a simplified invoice is allowed, or above it, when a full VAT invoice is needed.
The VAT fraction
When a price already includes VAT, the VAT is not 20% of it. HMRC calls the share of the gross price that is VAT the VAT fraction, worked out as the rate divided by 100 plus the rate. At 20% that is 20/120, or one sixth: a £120 price holds £20 of VAT. At 5% it is 5/105, or one twenty first: a £105 price holds £5. Multiplying a gross price by the fraction gives the VAT; whatever is left is the net value. Adding VAT works the other way: multiply the net price by 1.2 at the standard rate or 1.05 at the reduced rate.
Mixed rate invoices
One invoice can carry several rates: a builder installing energy saving materials at 5% alongside other work at 20%, or a shop selling children's clothes at 0% and adult clothes at 20%. Each rate needs its own VAT figure, and a full VAT invoice shows the rate for each line and the total VAT. This calculator adds up the lines at each rate separately, works out the VAT on each group, and gives one total. The per line VAT shown beside each amount is for checking; the totals are what the invoice uses.
Simplified and full VAT invoices
A VAT registered business can issue a simplified invoice when the supply is £250 or less including VAT, and the customer agrees. It shows the seller's name, address and VAT registration number, the time of supply, a description, and for each VAT rate the total including VAT and the rate. Above £250, a customer who asks for a VAT invoice must get a full or modified one, with the net amounts, the VAT and the customer's details. Exempt supplies must not be included on a simplified invoice.
Rounding the VAT
HMRC's rules let a business work out VAT per line or per invoice. Per line, the VAT can be rounded to the nearest penny or half penny, or down to the nearest tenth of a penny, as long as the method is consistent. Invoice traders may also round the total VAT payable on an invoice down to a whole penny. This tool rounds each rate's VAT to the nearest penny, half a penny up, which is one of the accepted methods; your accounting system may differ by a penny on large invoices.
Which rate applies
Most goods and services are standard rated at 20%. The reduced rate of 5% covers a short list, such as domestic fuel and power, children's car seats and some energy saving installations. Zero rated items include most food, children's clothes, books and newspapers. Exempt supplies, such as most insurance, finance and postage stamps, carry no VAT at all. The rates have been 20%, 5% and 0% since the standard rate rose from 17.5% on 4 January 2011.
VAT on quotes and invoices
Business customers usually compare quotes net of VAT, while consumers expect the gross price. Say which a quote shows. The proposals module labels tax as VAT when the currency is GBP, with a tax rate on each pricing line, so the net, VAT and gross split worked out here goes onto the quote line by line and carries into the invoice when the client accepts.
Limits
- Rates checked on 21 October 2026 against the Value Added Tax Act 1994 and HMRC guidance. This is arithmetic, not tax advice.
- Lines at each rate are totalled, then the VAT is rounded to the nearest penny, half a penny up. HMRC also lets invoice traders round the total VAT down to a whole penny.
- No flat rate scheme, no margin scheme and no domestic reverse charge for construction services.
- Exempt supplies carry no VAT and must not appear on a simplified invoice; use 0% here only for the arithmetic.
What it does not do
- It does not prepare a VAT return.
- It does not decide which rate an item takes.
- It does not store the amounts.
Questions people ask
How do I take 20% VAT off a price?
Divide the gross price by 1.2 to get the net price, or multiply it by one sixth to get the VAT. For £360, the net price is £300 and the VAT is £60. Taking 20% of £360 would give £72, which is wrong because the £360 already includes the tax.
What is the VAT fraction at 5%?
One twenty first, which is 5 divided by 105. A gross price of £84 at the reduced rate holds £4 of VAT and £80 net. HMRC lists the fraction for each rate in VAT Notice 700, and the same formula works for any rate: the rate over 100 plus the rate.
When can I give a simplified VAT invoice?
When the supply is £250 or less including VAT, the customer agrees, and none of it is exempt. If your business is based in Northern Ireland, the customer must also not be from an EU member state. The simplified invoice still shows your VAT number, the tax point, a description and the total and rate for each VAT rate.
Is VAT charged on postage?
Postage stamps sold by Royal Mail are exempt, but if you charge a customer for postage and packing as part of delivering goods, that charge usually takes the same VAT rate as the goods themselves. So posting standard rated goods means the delivery charge is standard rated too.
Do I add VAT if I am not VAT registered?
No. A business that is not registered for VAT must not charge it or show it on invoices. Registration becomes compulsory when VAT taxable turnover goes over the registration threshold in a rolling 12 months; check the current threshold on GOV.UK, as it is reviewed from time to time.
Quote it in GBP with VAT shown
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Background reading: the question page on this.
Written and checked by the OneCraft team. Last checked .