How to Add or Remove VAT from a Price
A clear guide to adding VAT to a net amount and removing VAT from a gross amount, with common mistakes to avoid.
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Adding VAT to a net amount
To add VAT at the standard UK rate of 20%, multiply the net (ex-VAT) amount by 1.20:
Gross = Net × 1.20
For example, £100 net + 20% VAT = £120 gross. The VAT portion is £20.
Removing VAT from a gross amount
To remove VAT from a price that already includes it, divide by 1.20:
Net = Gross ÷ 1.20
For example, £120 gross ÷ 1.20 = £100 net. The VAT is £20.
Common mistakes when reversing VAT
The most common error is subtracting 20% of the gross amount. This gives the wrong answer:
- £120 – 20% = £120 – £24 = £96 — wrong
- £120 ÷ 1.20 = £100 — correct
The reason: 20% of £120 (£24) is not the same as 20% of £100 (£20). VAT is calculated on the net amount, not the gross.
UK VAT rates
| Rate | Percentage | Applies to |
|---|---|---|
| Standard | 20% | Most goods and services |
| Reduced | 5% | Home energy, children’s car seats, some renovations |
| Zero | 0% | Most food, children’s clothes, books, newspapers |
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Use our VAT Add / Remove Calculator to add or remove VAT instantly from any amount.
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Last updated
Last reviewed: 2026-04-12T13:47:06.590Z.